Small and Medium-Sized Payment Institutions End 20 Years of Code-Stacking (AI Translation)
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- The Chinese payment industry is undergoing significant changes due to stricter regulations, including the People's Bank of China's (PBOC) '259 Document' which aims to curb illegal practices such as 'code matching' by enforcing 'one terminal per merchant' and 'one code per terminal.' In 2023, 50 payment institutions were penalized with fines totaling over 6 billion yuan, with major players like Alipay and Tenpay facing hefty fines for multiple violations.
- The crackdown on irregularities has led to a shift in the industry focus towards acquiring genuine merchants and expanding into real scenarios. Payment institutions are exploring new avenues such as overseas markets, cross-border payments, and providing technological services to merchants beyond payment processing. This transition is driven by the need to find new profit sources after losing income from previously prevalent practices like 'code matching.'
- The future regulatory landscape will be shaped by the implementation of the 'Regulations on Supervision and Management of Non-Bank Payment Institutions,' effective May 1, 2024. This regulation sets comprehensive and strict supervisory requirements across various aspects of payment services. Meanwhile, payment license numbers have been decreasing, with over 80 licenses canceled so far, mainly prepaid card licenses, reducing the number of payment institutions from over 270 at their peak to 188.
文｜财新周刊 张宇哲
By Zhang Yuzhe, Caixin Weekly
“在过去‘跑马圈地’的时代，支付机构做真实商户不赚钱，主要依赖‘套码’收入；但现在政策环境变了，逼着支付机构不得不转型了。”一位头部支付机构高管道出了当前支付行业面临的共同挑战。
"In the past era of 'scrambling for territory,' payment institutions didn't make money from genuine merchants and primarily relied on 'code-cashing' for income. However, with the change in policy environment now, payment institutions are forced to transform," revealed a senior executive from a leading payment institution, highlighting the common challenge faced by the current payment industry.
他所说的政策环境变化，一方面，是指中国人民银行2021年10月发布的《关于加强支付受理终端及相关业务管理的通知》（下称“259号文”），要求严格落实“一机一户”“一机一码”，堵上违规“套码”的口子；另一方面，是央行对支付领域乱象的整治力度前所未有，频频开出大额罚单。
The policy environment changes he referred to, on one hand, are related to the People's Bank of China's issuance of the "Notice on Strengthening the Management of Payment Acceptance Terminals and Related Businesses" (hereafter referred to as "Document No. 259") in October 2021. This notice mandates strict implementation of "one device, one account" and "one device, one code" policies to block loopholes for illegal "code stacking." On the other hand, it pertains to the central bank's unprecedented efforts to rectify disorder within the payment sector, frequently issuing hefty fines.
以处罚公告披露日期来统计，2023年共有50家支付机构被处罚，共计罚没金额超过60亿元，其中有8家支付机构被罚没金额超千万元。从单家机构看，两大支付巨头支付宝和财付通分别因为多项违规被罚没30.6亿元和29.9亿元，得仕股份有限公司和中汇电子支付有限公司被罚没的金额均超过8000万元。
According to the announcement dates of penalties, in 2023, a total of 50 payment institutions were fined, with the cumulative fines exceeding RMB 6 billion. Among these, 8 payment institutions were fined more than RMB 10 million each. Looking at individual entities, two major payment giants, Alipay and Tenpay, were fined RMB 3.06 billion and RMB 2.99 billion respectively for various violations. Desheng Shares Co., Ltd. and China Remittance Electronic Payment Co., Ltd. both faced fines exceeding RMB 80 million.
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