On June 27th, Blue Whale News learned that All shares of Quick Money Financial Services (Shanghai) Co., Ltd. ('Quick Money Financial') were pledged to Ningbo Meishan Bonded Port Area Changsheng Private Equity Fund Management Co., Ltd. ('Changsheng Private Equity') and Shanghai Wanda Network Financial was the pledger. The pledged equity was RMB 4,827,455,340, which is equal to the registered capital of Quick Money Financial.
According to public information, Quick Money Financial was founded in 2011, and its business scope includes financial information services (except for financial businesses), receiving commissions from financial institutions to carry out financial information technology outsourcing, and financial business process outsourcing.
In addition, Quick Money Financial is an indirectly controlled shareholder of licensed payment institution Quick Money Payment Clearing Information Co., Ltd. ('Quick Money Payment'). Tianyancha shows that Quick Money Payment has two shareholders, the controlling shareholder is Fuzhou Net Network Technology Co., Ltd. (52.01% stake) and Nanning Xingu Information Technology Co., Ltd. (47.99% stake), both of which are wholly-owned subsidiaries of Quick Money Financial.
Quick Money Payment was established in 2004 and obtained a payment license in 2011. It is one of the first batch of licensed payment institutions. Its business types are internet payment, mobile phone payment, and bank card acquiring, and its business covers the whole country. The validity period of the license is until May 2026.
As for the pledge holder, according to Tianyancha, Changsheng Private Equity Fund has two shareholders, Jin Yin-feng holding 95% and Li Ang-da holding 5%.
Blue Whale News found that the way of changing the controller of the payment license through the pledge of equity by the controlling shareholder has also occurred when PingPong acquired China Aerospace Times Electronics. Although it is not common, there are many ties between the two payment licenses and Changsheng Private Equity and Beijing PalmComm Technologies Development Co., Ltd.
For example, Jin Yin-feng, the controlling shareholder of Changsheng Private Equity, holds an 8.57% stake in PalmComm Technologies and serves as a supervisor; Tan Shuwen, the chairman and actual controller of PalmComm Technologies, holds shares in several companies related to Changsheng Private Equity, and the proportion of shares held has not been disclosed, and served as a supervisor of Changsheng Private Equity from March 2017 to July 2018.
Tan Shuwen had operated a college student loan product called Cat Loan through Shanghai TONG FU Financial Information Service Co., Ltd., and had invested in Xianhua Venture Capital Fund directly, which in turn had invested in Xian Hua Information Technology (Beijing) Co., Ltd. Later, on June 24th, 2019, the case was investigated by Chaoyang Branch of Beijing Public Security Bureau.
It is understood that PalmComm Technologies operates the mobile payment service provider 'PP Wallet', which received millions of angel round funding from Huachuang Capital in January 2012 and RMB 150 million Series A financing from Xianfeng Changqing and IDG Capital in January 2014. Tang Ning, the founder and CEO of Yixin, and Huachuang Capital's founder, holds a 11.98% stake in PalmComm Technologies. Wu Haiyan, a managing partner of Huachuang Capital, serves as a director of PalmComm Technologies.
Public information shows that PalmComm Technologies has payment products such as PP Wallet and Flash Beans. In early 2013, PalmComm Technologies launched PP Wallet and officially entered the mobile payment field. When it was launched, PP Wallet was positioned as a social payment application, and it mainly supported P2P transfers among friends in the address book. As of September 2014, PP Wallet has covered more than 50 million users, serving over 20 million payment users, and processing over 1 million transactions per day.
In early 2015, PalmComm Technologies launched another brand of internet finance service called 'Flash Beans', which is a payment product specially developed for single-machine game payments. It is committed to providing young people with financial services such as payment, credit, and wealth management.
According to the content on a website named 'PP Wallet', PP Wallet is a global leading mobile payment solution provider with business covering more than 50 countries and regions on five continents. As of the end of 2019, PP Wallet handles more than 30 million mobile payment transactions per day for more than 20,000 banks and non-bank financial institutions and over 30 million merchants worldwide, with a total transaction amount of over RMB 10 trillion. It also provides payment-based value-added services and industry application solutions such as electronic membership cards, Mini Programs, e-invoicing, mobile advertising, etc. to merchants.
As early as January 2018, PalmComm Technologies attempted to acquire a payment license by acquiring a 49% stake in Zhejiang Aerospace Electronic Information Industry Co., Ltd. ('Aerospace Electronic'), which has a payment business license. It is learned that Aerospace Electronic obtained the 'Payment Business License' in 2012, and after two extensions, the validity period of the license has been extended until June 2027.
In 2018, China Aerospace Times Electronics signed an agreement with Oriental Zhiji for the above equity for RMB 233 million, but the transaction failed to get regulatory approval as scheduled. After several delays, the cooperation was finally announced to be terminated in 2021.
In October 2019, China Aerospace Times Electronics had a stock equity pledge, and PingPong was the pledgee. Stock equity pledge is a kind of right pledge, which means that the pledgor and the pledgee agree that the pledgor pledges the shares he holds as collateral to borrow money from the pledgee. When the pledgor fails to repay the money according to the agreement upon maturity, the pledgee can be compensated at a discount according to the agreement on the shares, or sell the shares.
Obviously, the purpose of the pledge is not cash, but control rights.
Subsequently, PingPong controlled the major shareholder of China Aerospace Times Electronics, Shanghai Yiqian Network Information Technology Co., Ltd., in the form of stock equity pledge, and indirectly brought the licensed payment institution under its umbrella.
It is worth noting that in June of this year, the headquarters of the People's Bank of China issued a penalty of tens of millions of yuan to China Aerospace Times Electronics under PingPong, but the penalty was aimed at Mou Chunyan, the former responsible person of China Aerospace Times Electronics in 2019, instead of PingPong.
Specifically, China Aerospace Times Electronics violated a total of 8 types of illegal activities, involving violations of institutional management regulations, merchant management regulations, settlement management regulations, account management regulations, and other regulations. In terms of customer transactions, it failed to fulfill its obligations to identify customer identities, failed to save customer identity information and transaction records as required, failed to submit suspicious transaction reports as required, and engaged in illegal activities such as transactions with customers with unidentified identities or opening anonymous accounts and pseudonymous accounts for customers. The total amount of the penalty was about RMB 44.2162 million.
In response, PingPong stated that the punishment was aimed at some non-compliant issues in the domestic payment business conducted by China Aerospace Times Electronics prior to its acquisition in 2019 and at the then operation person, and had nothing to do with PingPong's business.
According to the content of the penalty, Mou Chunyan, the then Assistant General Manager of China Aerospace Times Electronics, and Zhang Mouquan, the then Director of the Business Department of the company, were fined RMB 115,000 and warned and fined RMB 300,000, respectively.
According to Tianyancha, Mou Chunyan, who was punished, is a co-founder of Palm Commerce, who joined China Aerospace Times Electronics Beijing Branch in June 2018 and resigned as the legal representative of the company in July 2020. He currently serves as a senior executive in 7 enterprises, including serving as a director of Palm Commerce since 2012.