In 2024, the People’s Bank of China (PBOC) introduced a new licensing system for non-bank payment institutions, signaling a significant shift in regulatory practices. This update has extended the validity of permits to 13 firms, including major tech companies like ByteDance and Huawei.
The New Licensing Framework
The revised licensing approach contrasts with the previous five-year renewal cycle, aiming for greater efficiency in oversight. This extended model is part of broader efforts to enhance control over China’s expansive digital payment sector.
Notably, while some large firms have been granted renewed licences, others have faced permit denials due to non-compliance with updated standards. Since the introduction of third-party payment licenses in 2011, only 169 are now active, marking a decline from an initial issuance of 271.
Strengthening Compliance and Stability
According to PBOC representatives, the move towards longer-term licences is designed to bolster stability and maturity within the payment industry. The primary objectives include maintaining compliance and mitigating systemic risks in a fast-changing market environment.
