The Chinese online payment ecosystem will see more regulation as all third-party payment companies including Alipay, WeChat Pay will have to transfer transaction data to Wanglian, Sohu is reporting (in Chinese).

On August 4th, the People’s Bank of China, the central bank of China, issued a document stating:
“Starting on June 30, 2018, payment agencies involved in the online payment business that accept bank accounts will have to use Wanglian (网联, meaning network platform or Non-Bank Internet Payment Union). By October 15, 2017, banks and payment companies should migrate their business to Wanglian.”

So what does this mean? In the past, when people wanted to make an online payment between different banks in China, they could use the third party payment companies directly. For example, we can transfer money from one bank account to the other account using Alipay, without any third party’s intervention. This model bypasses the central bank’s clearing system, and the transaction data is kept by third-party payment companies.

The problem central bank sees here is that by allowing these third party payment companies to control the payment channels and data, it could possibly lead to money laundering, cashing out problems, or stealing funds. To follow with the payment data and to manage the flow of funds, the central bank decided to intervene in the transaction process using Wanglian. Now the third party payment companies online payment channels, no longer directly deal with banks, but send the payment data to the Wanglian.

From the regulatory point of view, the debut of Wanglian, as a real-time monitor, will better control financial risks and to improve the transparency of third-party payment market.

Third-party payment companies will no longer be able to enjoy the freedom of managing user’s funds by themselves. Unlike in the past, when these third party payment companies dealt with a number of banks, now they only need to deal with Wanglian which will reduce their transaction costs and enhance the security of the transaction.

In users’ point of view, it will not change using habit of third-party payment services, just that the payment data will be collected by Wanglian rather than their party payment companies. The good news is that user’s financial security will be more guaranteed and rates could potentially be lower.

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Eva Yoo

Eva Yoo is Shanghai-based tech writer. Reach her at

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