The Regulations on the Supervision and Administration of Non Bank Payment Institutions were officially announced on the 17th. The new regulations, which took nearly three years from public solicitation of opinions to their complete release, are also the first administrative regulations introduced in the financial field after the Central Financial Work Conference. Why are the new regulations introduced, what are the changes, and how will they affect the non bank payment market? With the rise of new formats such as China's digital economy and e-commerce, non bank payment services have rapidly developed and played an important role in the field of small and convenient payments. According to relevant data from the People's Bank of China, as of the end of September this year, there were a total of 185 non bank payment institutions in China. In 2022, they processed over 1 trillion payment transactions with a total amount of nearly 40 trillion yuan, accounting for about 80% and 10% of the total electronic payment business in the country, serving over 1 billion individuals and tens of millions of merchants. Under the rapid development, some payment institutions have also engaged in illegal operations from time to time. For example, illegally misappropriating user funds, leaking or improperly collecting and using user information; Individual payment institutions take risks and provide funding transfer channels for illegal activities such as telecommunications fraud and cross-border gambling. It is timely to conduct pulse diagnosis for the non bank payment industry. In this context, it is urgent to formulate specialized administrative regulations and establish a long-term mechanism to promote the healthy development of the non bank payment industry. The report of the 20th National Congress of the Communist Party of China proposed to legally regulate all types of financial activities. The Central Financial Work Conference proposed to strengthen the construction of financial rule of law and timely promote legislation in key and emerging areas of finance. As a result, new regulations have emerged in the non bank payment industry. From the perspective of risk prevention and user protection in the new regulations, the spirit of the Central Financial Work Conference has been consistently integrated into the new regulations, placing risk prevention and resolution, and protecting the legitimate rights and interests of users in a prominent position to better coordinate development and security. Industry insiders believe that this new regulation supplements the legal system of non bank payment institutions in China, solves the problem of low legal hierarchy in the supervision of non bank payment institutions, and is conducive to improving regulatory efficiency. To strengthen supervision and protect the legitimate rights and interests of users, the new regulations start from four aspects: first, adhere to licensed operations and strictly enforce entry barriers; Secondly, improve payment business rules and strengthen risk management; Thirdly, strengthen the protection of user rights and interests; Fourthly, we will increase the punishment for serious violations of laws and regulations in accordance with the law. The above regulations stipulate the strengthening of the management system for payment accounts, reserves, and payment instructions, and clarify that payment institutions shall not misappropriate, occupy, or borrow customer reserves, and shall not forge or alter payment instructions. Strengthen the responsibilities of due diligence and risk monitoring for payment institution users. At the same time, it is necessary to strengthen the protection of user information, clarify the requirements for information processing, information confidentiality, and information sharing. It is worth noting that the regulation combines years of regulatory practice, draws on the experience of payment business classification in other countries and regions, adheres to the concept of functional supervision, and starts from the essence of the business. Based on whether it can receive prepaid funds from payers, it is divided into two categories: stored value account operation and payment transaction processing. The relevant person in charge of the People's Bank of China stated that the above classification method has good scalability, is conducive to preventing regulatory gaps, and can also avoid regulatory arbitrage, which is conducive to promoting fair competition. Meanwhile, the supplementary provisions of the regulations clearly state that they have been implemented in accordance with
Edit：Hou Wenzhe Responsible editor：WeiZe
Source：chinanews.com
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