Jul. 16 – China’s central bank, the People’s Bank of China (PBOC), has granted a new batch of payment service licenses by way of a decree entitled “Measures for the Administration of Payment Services of Non-Financial Institutions” (PBOC Order  No. 2) to 27 additional companies, which includes affiliates of both the Sina Corporation and Baidu, Inc. Sina is known for its online Weibo platform (which functions as a micro-blog similar to Twitter), while Baidu is the most popular search engine in China.
PBOC Order No. 2 stipulates that a non-financial institution that intends to provide payment services must obtain a payment service license in order to be recognized and function as a payment institution. Payment services refer to accepting online payments, issuing and accepting prepaid cards, collecting bills via bank cards and any other types of payment-related services as determined by the PBOC.
PBOC Order No. 2 also states that eligible applicants must have a minimum registered capital of RMB 100 million to be able to provide payment services at the national level, or RMB 30 million to be able to provide payment services at the provincial level.
The PBOC first started granting payment licenses in May 2011. Other internet-based companies that have already been granted licenses include Alipay, TenPay, ShengPay, SNDA and NetEase.
Alibaba’s Alipay currently dominates China’s online payment service market.
Up until now, the PBOC had granted a total of 7 batches of payment licenses involving 250 Chinese enterprises.
Furthermore, according to China Daily, two of the 27 total companies that were granted licenses were foreign-invested companies: Edenred China and Sodexo Pass China (Shanghai). They are the first foreign-invested enterprises to receive such a license. World-renowned online payment service provider Paypal has yet to be granted a license.
You can stay up to date with the latest business and investment trends across China by subscribing to Asia Briefing’s complimentary update service featuring news, commentary, guides, and multimedia resources.
Setting Up an Online Shop in China
China Further Promotes E-Commerce Development
MOC: China is Mulling E-Commerce Tax
Tapping into China’s Online Sales Market
Previous Article « Shanghai Releases Guideline for Handling Disputes Over Service Inventions
Next Article China Looks to Transform Its Financial Sector »
Dezan Shira & Associates´ brochure offers a comprehensive overview of the services provided by the firm. With its team of lawyers, tax experts, auditors and...
A firm understanding of China’s laws and regulations related to human resources and payroll management is absolutely necessary for foreign businesses in...
Doing Business in China 2022 is designed to introduce the fundamentals of investing in China. Compiled by the professionals at Dezan Shira & Associates in...
With the scope and penalties of China’s social credit system being further clarified in 2021, legal and regulatory compliance has become more important than...
As a legitimate tool for reasonable tax planning and cost saving, tax incentives play an important role. Companies also use tax incentives as a useful...
Over the last few months, China has been quickly expanding the pilot program on electronic special value-added tax (VAT) fapiao (hereafter special VAT...
Dezan Shira & Associates helps
businesses establish, maintain,
and grow their operations.
Stay Ahead of the curve in Emerging Asia. Our subscription service offers regular regulatory updates,
including the most recent legal, tax and accounting changes that affect your business.