PBOC drafts antitrust measures for non-bank payment companies

Friday 22 January 2021 13:03 CET | News

China’s central bank has proposed stepping up antitrust measures for companies in the non-bank payments industry, such as Ant Group’s Alipay and Tencent’s WeChat Pay.

Under draft rules proposed on 20 January, the People’s Bank of China (PBOC) can advise the state council’s antitrust committee to stop companies abusing their dominant position or even break up a non-bank institution if it ‘severely hinders the healthy development of the payment service market’.

The PBOC’s proposed rules coincide with a wider government clampdown on the financial activities of Chinese technology giants amid growing concern over the risk of financial contagion resulting from their empire building.

The PBOC will hold talks with institutions over their market dominance once a single player’s market share reaches a third of the total non-bank payments industry or when the market share of two players combined reaches half of the total.

It will also identify institutions as having a monopoly once a single player garners more than half of the market in nationwide electronic payments, which also includes online and mobile banking payments.

Non-bank payment service providers must also comply with the PBOC’s anti-money laundering and anti-terrorism requirements. If these are severely breached, the central bank can revoke the player’s licence under the new rules.

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Keywords: PBOC, Ant Group, Tencent, fintech, payment market, banking, monopoly
Categories: Banking & Fintech
Countries: China
This article is part of category

Banking & Fintech