Bans wechat pay alipay six more professional#
Bans wechat pay alipay six more series#

The NetsUnion Clearing Corporation (NUCC) was established by the Payment and Clearing Association of China and is in charge of clearing online transactions routed from third-party payment institutions nationwide.

Bans wechat pay alipay six more series#

To address the above concerns, the central bank, PeopleвЂ™s Bank of China (PBOC), has issued a series of notices on the separation of customer funds, and created a new clearing organisation for online transactions routed by third-party payment institutions such as Alipay. The banks cannot promise to match AlipayвЂ™s efficiency. However, if online transactions are carried out by financial institutions, they will undoubtedly add to the workload and cause delays.

Bans wechat pay alipay six more professional#

On the contrary, such scope should fall under commercial banks and other professional institutions. With its giant capital pool for investments, could Alipay be considered a bank and therefore be subject to regulation?ДЄccording to the Law on Commercial Banks, В вЂno entity or individual may engage in absorbing public deposits or other businesses of a commercial bank.вЂ™' В It could therefore be considered as a denial to the legality of AlipayвЂ™s position to take in public deposits and run such banking services transaction settlements. With AlipayвЂ™s wide banking network, inter-bank transactions has been cut to a single transaction, eliminating UnionPayвЂ™s role in the entire process. Cash flow under this scheme would be the movement of funds between a consumerвЂ™s bank account and AlipayвЂ™s bank account. By opening bank accounts with several banks, Alipay can perform inter-bank clearing and settlement all by itself. UnionPayвЂ™s monopoly of facilitating inter-bank transactions is being challenged. UnionPay charges different processing fees for each transaction on its platform depending on sector. The traditional cash flow was that funds charged from a consumerвЂ™s issuing bank account would be directed to UnionPay, then UnionPay would handle further settlement and clearing with the procuring bank. Before the rise of Alipay, all inter-bank transactions, either online or offline, would have had to go through UnionPay, which is an association of ChinaвЂ™s bank card sector. The functions of a financial intermediary, such as China UnionPay, В are becoming obsolete. As a result, even more consumers, companies and institutions are part of this credit system. In China, Sesame Credit has now grown into a political and social scoring system. Sesame Credit enrols users into its new National Credit System through consumer transactional data. As a direct consequence of Ant FinancialвЂ™s involvement, more Chinese consumers are choosing YuвЂ™e Bao as a virtual wallet for their savings, rather than hold money in bank accounts.

Alipay uses the full-scale financial services offered by the Ant Financial Services Group, such as money market (YuвЂ™e Bao), В insurance (Zhong An), В credit rating (Sesame Credit, also known as Zhima Credit), В and personal credit limits (Ant Micro Loan). As a result, state-owned banks are forced to innovate due to the unprecedented challenges posed by e-payment systems.ДЄlipay removes intermediaries and reduces financial transaction costs. This leads to a вЂfinancial transactional bypass scenarioвЂ™ where state-owned commercial banks are leaning towards a position of reduced risks involved with wealth management service and mutual fund business. Д¬apital disintermediation is when the consumer accesses the capital market directly to carry out investments. Traditional banks are now faced with the challenges of capital and technical disintermediation. In China, financial institutions acting as intermediaries have gradually lost their significance in the payment cycle of monetary transaction. The proliferation of smartphone and mobile payments has transformed Alipay from the original intention of simply facilitating e-commerce for individuals, to wider financial investment financial use. Its rise in popularity in relation to the existing banking system is closely associated with disintermediation. Alipay and the impact of e-payment systems resulting in new regulations in China and other jurisdictions - China Working GroupД«ack to Asia Pacific Regional Forum publicationsД¬hien Yeh & Associates, is a third-party online and mobile payment platform, founded in Hangzhou, China in 2004.