Name
Global FinTech Guide
Country _ Name
China
SectionTitle
Payment services
Body
FinTechs belonging to this category offer alternative payment services which are supposed to provide a faster and cheaper way for national, European, and international payments for private and business customers by using new technologies.

For example, payment service providers hereby offer solutions to easily integrate several payment services in online shops.

Some FinTechs furthermore provide real cash register systems and online-reservation solutions for restaurants and shops providing their own payment services or making use of the payment services of FinTechs described above.

Introduction

Attitude of the country towards modern payment services

In China, other than traditional payment services which are mainly provided by banks, modern payment services, such as WeChat Pay or Alipay etc., have developed rapidly, and been deeply integrated into people's life in the past decade. Not only do they cover the commercial sector such as restaurants, stores, and entertainment venues, but also include non-profit institutions and facilities such as buses, subways, and medical hospitals etc., and have been available in China and abroad. The PRC government has been supporting the development of modern payment services continuously. However, since the payment service is a kind of finance service, the strict entry thresholds and regulatory system are also imposed on the payment service providers. The modern payment service providers must have a special license to be engaged in such service and shall comply with the detailed and comprehensive regulatory requirements continuously.


Legal affairs

Obligations and requirements to provide payment services or ancillary services described above

In general, the payment service providers can be either financial institutions or non-financial institutions, provided that such service providers satisfy the relevant requirements and hold the proper payment service license. With respect to the payment service in FinTech, non-financial institutions which hold payment service license take the key roles in this area.

First of all, any entity engaged in the payment service activity shall obtain a payment license issued by the People's Bank of China (PBOC). Depending on the scope of payment services to be engaged, PBOC has set different requirements for the minimum registered capital of the license's applicants. Pursuant to the Administrative Regulations of Non-Bank Payment Institutions that came into effective since May 1, 2024 ("NPI Regulation”), (1) for basic online payment services, the minimum registered capital is RMB200 million (equivalent to approximately USD27.88 million or EUR24.05 million) (The FX rates at June 25, 2025 are as follows: EUR1 = CNY8.32 USD1 = CNY7.17); (2) for the nationwide operation of online payment services in relation to the pre-paid cards, the minimum registered capital is RMB200 million; (3) for the operation of both (1) and (2), the minimum registered capital is RMB300 million (equivalent to approximately USD41.82 million or EUR36.06 million). After obtaining the payment license, the payment institution shall still keep a good operating record. In case of the serious operation risk and the serious violation of laws and regulations, PBOC may suspend/stop the business operation of the payment institution.
The government encourages foreign institutions to participate in the development and competition of China's payment service market. PayPal has acquired a Chinese payment institution in 2019 and became the first and currently only 100% foreign-owned payment institution in China, which is followed by Airwallex in 2023. Recently, Payonneer has obtained the approval of PBOC in April 2025 for the acquisition of a Chinese payment institution.

Secondly, as FinTech relies heavily on the Internet to provide services/information/content, an ICP (Internet Content Provider) license issued by telecommunication authority is required. Please note that most of the ICP license are subject to the foreign investment restriction – i.e., the foreign shareholding ratio of the applicants shall be no more than 50% and shall satisfy other requirements (such as has obtained the telecommunication operation license in country where it is resided etc.).
Thirdly, to carry out the cross-border foreign exchange payment business for e-commerce, the payment institution shall obtain permission from the Foreign Exchange Bureau.
Lastly, the payment institution shall also continuously comply with a series of laws and regulations, including but not limited to in the area of protection of customer information, anti-money laundering, face recognition etc.

Additional comments regarding the legal situation for payment services or what FinTech’s must be aware of in this business area

From May 2011 to March 2015, PBOC issued a total of 271 payment licenses and the payment service industry developed rapidly. However, it is worth noting that, after 2015, PBOC takes a more conservative position on issuing the licenses and continues reviewing the qualifications of existing license holders. Some existing licenses were revoked in the past few years because the service providers cannot satisfy the requirements anymore. In 2025, the total amount of payment service providers has shrunk to 169. Since 2015, although no explicit regulation prohibits issuance of new license, from the perspective of regulatory, PBOC has not issued any new online payment licenses yet. It seems that PBOC intends to control the total amount of the licenses and strengthen the risk controlling of the existing license holders. Therefore, if a new player would like to be engaged in online payment service business, it may have to consider acquiring the shares of the existing license holders, rather than applying for a new license.

Notwithstanding the above, considering that the New Regulation has become effective since May 1, 2024, it is possible that PBOC will reopen the licenses issuance based on the requirements set out in the NPI Regulation in the future. Currently, based on the public news, PBOC has only approved the renewal of a batch of existing licenses based on the NPI Regulation in July 2024, rather than issuing the new license.


Economic conditions

Market size for payment services and biggest payment service providers

The market for payment services in China is huge, especially the online payment market. As of December 2024, the number of online payment users in China reached 1.029 billion, with an increase of 75.05 million compared with the number in December 2023, accounting for 92.8% of the total internet users in China. (Source: China Internet Network Information Centre (CNNIC),
https://www.cnnic.net.cn/NMediaFile/2025/0428/MAIN17458061595875K4FP1NEUO.pdf, January 2025.) From the perspective of the transaction amount, for the year 2024 alone, the non-bank payment institutions processed 1,340 billion online payment transactions, with an amount of RMB331.68 trillion (equivalent to approximately USD46.30 trillion or EUR39.60 trillion) (Source: PBOC, http://www.pbc.gov.cn/zhifujiesuansi/128525/128545/128643/5589365/2025021417373037368.pdf, February 2025.)

Alipay and WeChat Pay, relying on the online shopping platform and the social App, are the key providers of payment services in China.

Additional comments regarding the economic situation for payment services or what FinTech’s must be aware of in this business area

Currently, platforms led by Alipay and WeChat Pay have dominated both the customer-end market and business end market, forming an oligopolistic competition pattern. Another leading platform in the business-end market is Union Pay, which is more frequently used by card users.

Moreover, the scale of cross-border payment transactions is expected to continue to expand, and the online cross-border payment service market could be further developed. In 2024, the RMB cross-border payment system processed 8.2169 million transactions with a total amount of RMB175.49 trillion. The number of transactions increased by 24.25%, and the transaction amount increased by 42.60% compared to the previous year.

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