The People’s Bank of China (PBOC) is set to issue licences for non-financial institutions that offer online payment services to the country’s consumers. The move is likely to increase competition in China’s e-payment sector and will regulate e-payment platforms – financial and non-financial payment service providers.
Draft legislation was issued in November to regulate the issuing and managing of e-currencies. Non-financial organisations have not been subject to any real supervision so far. The difficulty in regulating such market players has arisen “as there are large numbers of market players, which have different qualifications”, according to Natasha Xie, a Partner at Jun He Law Offices in Shanghai. “The supervision is analogous to that over quasi-financial institutions. The regulator is not entangled in how many licences should be issued, but focused on formatting criteria for third party vendors,” said Xie. “The regulator is considering how to govern the business continuously.” The licensing process would only concern national payment providers.
