① The Beijing branch of the People's Bank of China disclosed 5 payment institution fines in one go on September 10. Among them, Youzan paid a forfeiture amount of 27.87 million yuan, making it the second largest fine in the payment industry during the year, and it is rare for both general managers to be fined at the same time. ② Industry insiders say that industry regulations are becoming more and more refined, and everything from service agreement formats to transaction information needs to be fully filed. Judging from regulatory trends, the double penalty system continues in the payment sector.
Financial Services Association, September 11 (Reporter Guo Zishuo) On September 10, the Beijing branch of the People's Bank of China revealed five payment institution fines in one go, against five payment institution fines, including Beijing Duxiaoman Payment Technology Co., Ltd. (hereinafter referred to as Du Xiaoman Payment), Beijing Gaohuitong Commercial Management Co., Ltd. (hereinafter referred to as Linkage Advantage), and La Cala Payment Co., Ltd. (hereinafter referred to as La Cala). The total amount of forfeited amounts exceeded 36 million yuan.
Among the five payment companies that were fined, Youzan Pay was fined 27.87 million yuan, making it the second largest fine in the payment industry during the year, and it is rare for both general managers to be fined at the same time.
Uncommon two-term general manager fined
Specifically, Youzan Pay carried out bar code payment services in violation of regulations; failed to promptly dispose of possible special merchant payment interface transfers; failed to strictly implement the real-name review requirements for account opening; violated account management regulations; operated prepaid card services in a hyperregion; carried out a transfer operation with a different name in violation of regulations. It was warned by the Beijing branch of the People's Bank of China, which confiscated 12.147,36054 million yuan of illegal proceeds, and was fined 15.72614178 million yuan, with a total forfeiture of 27.87350232 million yuan.
Zhu, the general manager of Youzan Pay at the time, was directly responsible for the company's illegal bar-code payment business; failed to strictly implement the real-name review requirements for account opening; and was directly responsible for operating the prepaid card business in a hyperregion. He was warned by the Beijing branch of the People's Bank of China and fined 0.2 million yuan.
Zhang Mouqing, general manager of Youzan Pay at the time, carried out bar code payment services against the company in violation of regulations; failed to promptly discover possible payment interface transfers for authorized merchants; failed to strictly implement the real-name review requirements for account opening; and was directly responsible for operating the prepaid card business in a hyperregion. He was warned by the Beijing branch of the People's Bank of China and fined 0.25 million yuan.
According to industry insiders, developing an independent bar code receipt business may be the focus of this round of penalties. Wang Pengbo, chief financial analyst at Broadcom Consulting, told the Financial Federation reporter that Youzan Pay does not have an offline bank card receipt license, but it is possible that it has independently launched a barcode billing business.
Youzan Pay's license was successfully renewed in June 2022. The scope of the exhibition was internet payment (nationwide), prepaid card issuance and acceptance (Beijing, Shanghai, Zhejiang, Guangdong, and Liaoning provinces). According to the latest “Implementation Rules of the Regulations on the Supervision and Administration of Non-bank Payment Institutions”, the scope of business coverage corresponds to Stored Value Account Operation Class I and Stored Value Account Operation Class II (Beijing, Shanghai, Zhejiang, Guangdong, and Liaoning).
Prior to that, according to the notice of the “Barcode Payment Business Specification (Trial)” issued by the People's Bank of China, non-bank payment institutions that provide customers with payment services based on bar code technology should obtain a license for online payment services; payment institutions that provide bar code payment receipt services to physical authorized merchants and online authorized merchants should obtain a bank card receipt business license and an online payment business license respectively.
Regarding the two general managers being punished one after another, Wang Pengbo believes that the new general manager is probably still continuing the previous business model, and the business has not changed before or after. According to Tianyan investigation, in August 2022, the legal representative of Zanpai was changed from Yan Xiaotian to Yu Tao. At the same time, the list of former directors (directors), managers, and supervisors was changed. Zhang Benqing withdrew, and Zhu Kun joined.
Multiple payment institutions have been double penalized
In the first half of 2024, a total of 26 institutions were penalized, and the total amount of forfeited amounts exceeded 0.1 billion yuan. Among them, 8 payment institutions were fined more than 1 million yuan, and 2 payment institutions were fined more than 20 million yuan. Among them, violating merchant management regulations; violating transaction information management regulations; violating the administrative regulations of outsourced agencies; and violating fund settlement management regulations are the focus of supervision. The direction of this round of punishment continues the direction of supervision in the first half of the year.
La Cala was warned by the Beijing branch of the People's Bank of China and fined 4.06 million yuan for not implementing the requirements of truthfulness, completeness, traceability and consistency throughout the process; not strictly implementing the requirements of the merchant's real-name system; and not settling merchant funds to their bank settlement account with the same name. The general manager and deputy general manager of La Cala Payment Co., Ltd. at the time were responsible for the company's failure to implement the requirements of truth, completeness, traceability and consistency throughout the process; for not strictly implementing the requirements of the merchant real-name system, they were each fined 0.15 million yuan.
In response, a person familiar with the matter revealed to the Financial Federation reporter that the ticket was mainly for the previous code hopping incident and was not a recent incident.
Linkage advantages were warned by the Beijing branch of the People's Bank of China and fined 2.9 million yuan due to failure to implement the requirements for truthfulness, completeness and traceability of transaction information; failure to strictly implement the requirements of the merchant's real-name system; failure to keep archival data such as special merchant application materials and qualification review materials in accordance with regulations; and failure to set up receipt accounts for authorized merchants in accordance with regulations. The company's deputy general manager at the time was warned and fined $0.15 million.
Du Xiaoman Payment was warned and fined 1.21 million yuan for not filing the terms of the payment service agreement format; not strictly implementing the real-name review requirements for payment account opening; opening payment accounts for financial companies in violation of regulations; processing transfers between payment accounts and bank accounts without the same name; not implementing the requirements of truthfulness, completeness, traceability and consistency of the entire process when uploading transaction information; and not strictly implementing requirements related to merchant management. The then general manager of the company was warned and fined 0.1 million yuan.
Accompanying Payment was fined $0.57 million for not implementing the real-name management requirements for authorized merchants and violating account management regulations. The then deputy general manager of Accompanying Payment Co., Ltd. was fined 0.01 million yuan.
“This round of fines revealed a number of new types of penalties. Judging from Gao Huitong, which has the highest penalty, bar-code payment services were carried out in violation of regulations; payment interface transfers from authorized merchants that may have been disposed of were not promptly discovered; and prepaid card services operating in hyperregions were rare in previous penalties.” Wang Pengbo believes that judging from the characteristics, industry supervision is becoming more and more refined, and everything from service agreement formats to transaction information needs to be fully filed. Judging from regulatory trends, the double penalty system continues in the payment sector.