FINANCE

BYD Overhauls Payment System as China Tightens Oversight

Published: Dec. 5, 2025 6:57 p.m. GMT+8

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China’s BYD Co. Ltd. (002594.SZ) is dismantling a massive digital payment system used to settle obligations to suppliers, marking a major shift in the country’s trillion-yuan shadow receivables market following a sweeping regulatory crackdown, Caixin has learned.

Since 2018, BYD has increasingly relied on Di Lian (迪链) vouchers — digital receivables certificates backed by the automaker’s own credit — as a key method of settling payments to suppliers. These instruments circulated within BYD’s vast supplier network or were discounted for cash, often through a factoring firm affiliated with BYD.

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BYD is dismantling its Di Lian digital payment system, which issued over 400 billion yuan ($57 billion) in vouchers to suppliers since 2018.
Regulatory crackdowns require BYD to phase out Di Lian within 2-3 years, shifting to cash or standardized bills, to protect SMEs and limit shadow financing.
This shift accelerates supplier payments, matches new rules for large enterprises, and reflects broader moves to curb China’s shadow receivables market.

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Who’s Who

BYD Co. Ltd.: BYD Co. Ltd. (比亚迪) is a Chinese automaker that is dismantling its "Di Lian" digital payment system, which issued digital receivables certificates backed by BYD's credit. This system, with over 400 billion yuan issued by mid-2023, allowed BYD to delay cash outflows to suppliers. Due to new regulations, BYD is phasing out Di Lian and shifting to cash payments and standardized bills.

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What Happened When

Since 2018：: BYD increasingly relied on Di Lian vouchers as a key method of settling payments to suppliers.

By mid-2023：: Cumulative Di Lian issuance exceeded 400 billion yuan ($57 billion).

2025：: China’s central bank and several other agencies issued rules imposing strict limits on digital receivables and defining relevant corporate platforms as information intermediaries, not financing vehicles, with a two-year transition period for compliance.