China’s central bank fines mobile payment operators

China’s central bank fines four companies 100 million yuan for violating payment service rules – SCMP

What happened: China’s central bank has fined four mobile payment operators a combined RMB 100 million ($14.7 million) in a move to increase oversight in the country’s huge payments sector. Alibaba’s Ant Financial was fined RMB 4.12 million ($604,000), Union Mobile Financial Technology RMB 26.4 million ($3.9 million), and Gopay RMB 46.4 million ($6.8 million). No reasons were given for the punishment, but Alipay said it was due to “certain irregularities” in its payment operations in mainland China.

Why it’s important: The People’s Bank of China (PBoC) has issued 270 licenses to mobile payment providers. However, sources have said that a number of these could be revoked as part of the new cleanup campaign that seeks to better regulate the industry, forcing compliance among other payment operators. Given the massive number of licenses that have been issued, it can be expected that regulators will begin kicking out smaller companies since Alipay and WeChat Pay control the majority of the market and mobile payment systems have gone mainstream.