In 2023, the "crime and punishment" of payment institutions: a total of more than 6.2 billion yuan was fined, and the renewal of the licenses of many institutions was suspended
In recent years, the supervision of payment institutions has become more and more stringent, and the relevant policies and regulations have become more and more perfect. At the end of 2023, the People's Bank of China (PBOC) promulgated the Regulations on the Supervision and Administration of Non-bank Payment Institutions (the "Regulations"), which will come into force on 1 May 2024.
The above-mentioned "Regulations" make provisions in four aspects: clarifying the definition and establishment license of non-bank payment institutions, improving payment business rules, protecting the legitimate rights and interests of users, and clarifying regulatory responsibilities and legal responsibilities.
According to incomplete statistics from Seven Finance, in the whole year of 2023, 50 payment institutions, including Alipay, Tenpay, and Deshi Shares, were fined, with a total fine of more than 6.2 billion yuan, and most of the reasons for the punishment involved violations of merchant or account management regulations, violations of liquidation management regulations, etc.
Eight payment institutions each received fines of more than 10 million yuan
Among the more than 50 payment institutions that were fined, 8 payment institutions received fines of more than 10 million yuan, namely Alipay, WeChat's Tenpay, Deshi Shares, Zhonghui Electronic Payment, Shanghai Huifu Payment, Kaidianbao Payment, Guangdong Huika Business Service and Shanghai Yinshengbao Electronic Payment.
Specifically, in chronological order from near to far, at the end of December 2023, the administrative penalty fine issued by the Shanghai Branch of the People's Bank of China shows that for violating the merchant management regulations and the liquidation management regulations, Deshi shares were warned, and about 2.4262 million yuan of illegal gains were confiscated, and a fine of 86.305 million yuan was imposed, with a total fine of more than 88.73 million yuan.
In the same month, Shanghai Yinshengbao Payment was also warned for violating the above problems, and a total fine of more than 17.5601 million yuan was confiscated. In addition to the same reasons for punishment as the above-mentioned Deshi shares and Shanghai Yinshengbao payment, in December last year, Shanghai Huifu Payment was also warned and confiscated 915,000 yuan of illegal income and fined 31,723,700 yuan for failing to perform customer identification obligations in accordance with regulations, failing to keep customer identity information and transaction records as required, failing to submit large-value transaction reports or suspicious transaction reports as required, and trading with unidentified customers.
Also in December, for violating the merchant management regulations and the payment account management regulations, Guangdong Huika Business Service was warned and fined a total of 21.8356 million yuan. At the same time, Yang Yi, then president of Guangdong Huika, was warned and fined 100,000 yuan.
At the end of October 2023, Zhonghui Pay was confiscated of 13.2811 million yuan of illegal income and fined 67.6255 million yuan for failing to handle the fund settlement of special merchants in accordance with regulations, failing to implement the real-name management of special merchants in accordance with regulations, and failing to set up settlement accounts of acquiring banks in accordance with regulations.
In July of the same year, the Henan branch of Kaidianbao Payment was fined 19.84 million yuan for violating the management regulations of special merchants and trading with unidentified customers, and the relevant responsible persons were also fined.
On July 7 last year, Tenpay was convicted of violating the regulations on the management of institutions, the regulations on the management of merchants and liquidation, the regulations on the management of payment accounts, other violations of laws and regulations that endanger the sound operation of payment institutions, damage the legitimate rights and interests of customers, or endanger the payment service market, failure to perform customer identification obligations as required, failure to keep customer identity information and transaction records as required, failure to submit large-value transaction reports or suspicious transaction reports as required, transactions with unidentified customers or opening anonymous accounts for customers, Pseudonymous accounts, violating the regulations on the protection and management of consumer financial information, and violating the regulations on the protection of the rights and interests of financial consumers, a total of nearly 3 billion yuan was confiscated.
On the same day, Alipay was also warned and fined more than 3 billion yuan for "seven crimes" such as trading with unidentified customers, violating regulations on clearing and payment account management, and violating the prevention of new types of illegal crimes in telecommunications networks.
Seven Finance noticed that in addition to the above-mentioned fines of 10 million yuan, Anfubao Business Co., Ltd., Tonglian Payment Network Services, and Shanghai Shengfutong Electronic Payment also received fines of 3.9416 million yuan, 2 million yuan and 1 million yuan respectively at the end of December last year.
In November, UnionPay Financial Network, Shenzhen Shenzhen UnionPay E-Service Financial Services and Jialian Pay were fined a total of more than 5 million yuan for violating liquidation management regulations and other illegal acts. In the same month, IPS and Fuyou paid fines of more than 9.55 million yuan on suspicion of violating the "Anti-Money Laundering Law......
In this regard, some industry insiders believe that anti-money laundering and merchant management are still the hardest hit areas of penalties in the payment industry, and the regulatory thinking is extending from focusing on the number and scale of illegal income to the nature of violations, and a larger amount of fines may represent a more serious nature of violations.
The payment licenses of a number of institutions have been cancelled and the review has been suspended
At the same time as the central bank issued penalties, the number of payment licenses is also shrinking further. As of the end of last year, the cumulative number of payment institutions whose licenses had been cancelled was as high as 84, of which 15 institutions had their payment licenses cancelled last year. As of the end of last year, the number of payment licenses in the country was 186.
Specifically, the last of the licenses cancelled last year was in September, when Ningbo UnionPay Commerce Co., Ltd. (also known as Ningbo UnionPay Commerce) took the initiative to apply for cancellation of licenses.
According to public information, Ningbo UnionPay Commerce was established in 2006 with a registered capital of 51 million yuan, and the legal representative is Yu Shanshan, which is a holding subsidiary of UnionPay Commerce, mainly engaged in the market operation, maintenance services and related value-added services of the "UnionPay" POS network in Ningbo.
In August 2023, the bank card acquiring license held by Guangdong Xinhui E-commerce was cancelled. According to the data, the date of the first license of the Xinhui e-commerce license was July 6, 2013, and in the renewal of the license in July 2023, the central bank made a decision of "not renewing" it.
In addition, the supply and marketing of Zhongbai Payment Co., Ltd., Chengdu Pay New Information Technology Service Co., Ltd., Jiangsu Dahehui Payment Business Service Co., Ltd., Beijing Hengda Xinyuan Payment Co., Ltd., Shenzhen Tengfutong Electronic Payment Technology Co., Ltd., Jiangsu Feiyin Business Intelligence Technology Co., Ltd., Bailian Youli (Beijing) Investment Co., Ltd., Shandong Yinli Payment Service Co., Ltd., Xi'an Chang'an Tong Payment Co., Ltd., Xiamen Xiashang E-commerce Co., Ltd., Yunnan JETCO Payment Management Co., Ltd., Anhui Baijiahui Payment Co., Ltd. and Yulin Yuanxiang Business Management Co., Ltd. were both cancelled licenses.
It is also worth mentioning that in January last year, the central bank decided to suspend the review of the renewal application for the "Payment Business License" of Guangdong Hui Card Commerce and Zhonghui Electronic Payment.
As early as August 2021, due to the circumstances stipulated in Article 24 of the Measures for the Implementation of Administrative Licensing of the People's Bank of China, the central bank decided to suspend the review of the renewal application of the "Payment Business License" of Deshi Shares.
However, the suspension of the above-mentioned license renewal does not mean "termination", and if the payment institution is under inspection or not inspected, the central bank will first implement the suspension of renewal measures when implementing supervision.