The People’s Bank of China announced on April 22nd that in order to ensure the effective implementation of the Regulation on the Supervision and Administration of Non-bank Payment Institutions (hereinafter referred to as the Regulation), the Detailed Rules for the Implementation of the Regulation on the Supervision and Administration of Non-bank Payment Institutions (Draft for Comment) (hereinafter referred to as the Detailed Rules) have been drafted. As the first administrative regulation issued in the financial field after the Central Financial Work Conference, the Regulations have redefined the payment business and classified it into two categories: stored value account operation and payment transaction processing. However, the specific classification method and the corresponding relationship between the old and new payment services need to be further clarified. Therefore, the Detailed Rules for Implementation aims to clarify the transitional arrangements, the connection between old and new payment services and other issues, so as to promote the smooth transition of the non-bank payment market.
Non-bank payment refers to payment services provided by non-bank institutions such as WeChat and Alipay, such as code scanning payment or transfer. According to the data of the People’s Bank of China, the business volume of such services has continued to grow at a high speed in recent years, and the annual transaction volume has exceeded 1 trillion, involving nearly 400 trillion yuan, serving more than 1 billion individual users and tens of millions of merchants. In view of the close relationship between payment business and public property safety, the "Regulations" and "Implementation Rules" aim to urge all payment institutions to operate according to laws and regulations and effectively protect users’ rights and interests.
Regarding the impact of the Implementation Rules on payment institutions, the central bank fully considered the possible impact of relevant provisions on the operation of payment institutions and the payment service market during the formulation process, and reserved sufficient transition period for existing payment institutions. At the same time, we strive to ensure that the same licensing matter follows the unified review standards and promote the openness, transparency and standardization of the administrative licensing work of payment institutions.
The specific impact is mainly reflected in:
1. Adhere to administration according to law. The Implementation Rules strictly follow the administrative licensing items set by the Regulations and refine the relevant work requirements and processes, aiming at improving the transparency, decision-making basis and process standardization of the administrative licensing work of payment institutions. In addition, the approval authority of some payment institutions will be appropriately decentralized to optimize the business environment ruled by law.
2. Insist on striving for progress while maintaining stability. The Detailed Rules for Implementation continues the previous regulatory thinking and macro-policy orientation, clarifies the connection mode between old and new payment services, and sets a long transition period, so that stock payment institutions have a transition period of nearly five years to ensure that their business license scope remains unchanged and achieve a smooth transition.
3. Adhere to both standardization and development. On the basis of giving consideration to development and safety, and according to the reality of the rapid development of the payment market, after full communication, the Implementation Rules moderately raised the requirements for registered capital and net assets, aiming at enhancing the risk resistance of payment institutions, strengthening corporate governance and steady operation, and better serving the real economy.
With regard to the registered capital requirements that have attracted much attention, Article 8 of the Regulations stipulates that the minimum registered capital of non-bank payment institutions is RMB 100 million, which will be increased according to relevant rules. Specifically, the minimum added value of registered capital of payment institutions engaged in multiple business types at the same time will be calculated cumulatively according to business types and business geographical scope and relevant regulations. This means that the minimum registered capital of a nationwide payment institution with a full license should be 400 million yuan.