You may have known that China’s central bank has tightened rules on mobile payments made by scanning a barcode, imposing restrictions that could slow the explosive growth for Alibaba’s financial services affiliate and that of its main rival, Tencent.
And the new policy will be officially carried out on April!
Daily Limits Payments
The recent regulations set daily limits on the amount consumers can spend each day using QR code payments, which affect venders a lot who receiving money via QR code, and it becomes difficult for consumers to pay a big amount payment via scanning QR code.
New Regulations
■ A single person paying via the static QR code (which are printed and put on walls) has a limit of RMB500 each day.
■ Additional daily limits of RMB 500 for each bank card apply to QR code payers who have connected their bank cards to WeChat Pay.
■ A single person paying via the dynamic QR code (which automatically changes on mobile) has 3 daily limits, RMB1,000, RMB5,000 or they can set an amount for the limit. QR code payers are required to complete different authentication procedures for these 3 limits.
Why Need to Set A Daily Limit?
To Forbid “Burning Money”
It was said the new rules target on forbidding “burning money” via subsidies to merchants, which are designed to capture market share from competitors.
Since 2014, Alipay and WeChat have spent billions of renminbi on subsidies to merchants and consumers aimed at promoting adoption of their platforms.
But spending on subsidies has slowed since early 2016 as the companies sought to cut expenses, with a decisive victory in the payments war by either side seeming impossible.
To lower “hidden dangers”
The lack of unified rules and technical standards created “hidden dangers” as well as “improper competition”.
“The market has developed so fast and has become an important payment method, but there are still some technical and market competition problems that need to be brought under control,” said senior analyst at Renmin University’s Chongyang Institute for Financial Studies in Beijing.
Of particular concern is the use of static QR codes such as those posted in shop windows. These codes can be shared, letting unknown parties use them to receive payment.
How to Affect Your Life?
1
There is a daily QR code payment limit of RMB500... but it's aimed at vendors. And the new daily payment limit is aimed at sellers, not consumers.If you spend more than 500 yuan on dinner, just ask cashier to scan the dynamic QR code on your phone, which is much safer.
2
The central bank has also set other daily transaction caps for different payment scenarios that will be "based on the security level of the transaction verification method."
With additional security measures* applied, banks and payment platforms that issue dynamic payment barcodes (like the ones on your personal account that change) can raise single-day limits to RMB1,000 or RMB5,000.
3
The providers are being told to "abide by the real-name registration system for sellers and improve management of risks arising from transactions." Payment providers and merchants accepting QR code payments will be required to obtain approval under the new rules.
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Ref:
FinancialTimes/That'sPRD/人民日报
HACOS,Business Services Solutions Master