Posted by PTL Group
PTL Group
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on Friday, 29 June 2018
in Business in China

Easier Market Access for Foreign Payment Firms: New Opportunities For Companies!

Rules for foreign-invested payment firms over Chinese market access have recently been changed by China’s central bank to promote openness and equality in their treatment towards foreign payment firms as compared to local payment firms. 

So far, foreign payment services have not – or hardly – been able to make RMB settlement in China. Even though global market leaders’ payment services, like Visa & MasterCard, are functional in Chinese market, but the payment is done through Union Pay settlement channel.  

These firms are required to have secure, regulated transaction and recovery systems in China with the capacity of processing payment services individually, according to the People’s Bank of China (PBOC).

PBOC specified that foreign firms that want to issue cards in the Chinese market need to acquire payment services licenses and set up a foreign-invested business in China. The Bank also affirmed their complete objectivity and neutrality in examining the submitted applications. 

Easing market access for foreign payment firms will have several impacts for local and foreign companies:

  • Improved competition in Chinese payments’ services sector, which is currently dominated by UnionPay, with the goal of leading to a higher quality of services offered.

  • Making the use of global reference payment services more common in China, facilitating payment transactions worldwide, particularly towards Chinese market.

  • Stimulate establishment and innovation of foreign companies in China.

  • Ease access to China’s middle-class, who are growing users of credit card payments.

  • Cross boarder E-commerce facilitation with Chinese market

Positive measure that above everything demonstrates once more government’s will to market openness and improvement that bring opportunities for foreign companies. This is just yet another measure that demonstrates the government’s openness towards allowing foreign companies to come into the market if it will improve the market for Chinese consumers overall. Overseas companies providing e-payment services are required to set up foreign-invested businesses in China and acquire payment services licenses, the People's Bank of China (PBOC) said in its online statement.

 

sources:

http://www.xinhuanet.com/english/2018-03/22/c_137055508.htm

http://www.menafn.com/1096632336/Central-bank-removes-hurdles-for-foreign-payment-firms

https://www.nasdaq.com/article/pboc-sets-out-rules-for-foreign-thirdparty-payment-firms-to-operate-in-china-20180321-00295

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