China Grants Third-Party Payment License to First-Ever Foreign Providers (July 15, 2013)
July 15, 2013
China’s central bank has granted new third-party payment licenses to 27 companies, including the first-ever foreign-funded payment service providers to receive licenses—Edenred China and Sodexo Pass China (Shanghai).
Since the Peoples Bank of China (PBC) began issuing the licenses in May 2011, a total of 250 nonbank institutions have been granted the right to conduct payment operations in the country. Among the newest batch of licensees, 19 were permitted to issue open-loop prepaid cards—including Edenred China and Sodexo Pass—while six were granted Internet payment licenses and two now are permitted to perform bank card acceptance. Edenred China is a subsidiary of Edenred, a France-based global prepaid provider. Sodexo Pass China, also headquartered in France, is owned by multinational corporation Sodexo. Both companies filed their applications for third-party payment licenses in 2011. The licenses expire after five years and are subject to renewal.
The new foreign licensees could be a landmark for other non-Chinese payment providers looking to enter the Chinese payment market, which industry observers see as ripe with opportunity but plagued by complex regulatory hurdles.