Chinese central bank proposes cap on third-party online payments

The daily cap is daily cap is CNY 5,000 (USD 817) on transactions through third-party online payment systems, and it is seen as an initiative to raise security protocols, ecns.cn reports. Under the draft guideline for public consultation, the amount shoppers would be able to spend through third-party online payment per day may be restricted to between CNY 1,000 (USD 163) and CNY 5,000, depending on how sophisticated the systems security checks are.

Platforms that have both digital certification and signature qualification checks will be exempt from the restrictions and the limit would be set at CNY 1,000 per day for platforms that have only one qualification check. For systems that fail to include digital certification and signature but has two or more checks, the limit would be CNY 5,000. When the spending amount exceeds the cap, consumers would be transferred to banking payment platforms to pay the surplus, according to the Peoples Bank of China (PBOC).

Meanwhile, consumers whose accounts limit them to shopping transaction will be allowed to spend no more than CNY 100,000 (USD 16.300) per year via the third-party payment systems. Those with more premium accounts that also allow for services like share purchases would be allowed to spend no more than CNY 200,000 (USD 32.600) per year.

According to a central bank official to Xinhua, nearly 61.3% of customers spent or transferred no more than CNY 1,000 in 2014, while 80.1% less than CNY 5,000, the source cites. The draft also bans third-party payment platforms from opening accounts for institutions running financial businesses such as online lending firms to avoid risks. Alipay, a domestic third-party payment platform under Alibaba, declined to comment on the draft guideline.