Payment Change in 2018: Six Banks have been disconnected

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 Payment Change in 2018: Six Banks have been disconnected


Journalist Mao Yuzhou

In 2017, the access of Netcom made the payment and clearing market, which had already been fiercely competitive, more turbulent, and doomed that the market would not be calm in 2018.

According to incomplete statistics from the reporters of the Securities Daily, there are at least six banks that have issued the announcement disconnected at present, including CITIC Bank, Everbright Bank, Postal Savings Bank, Bank of China, Bank of Communications and Ping An Bank.

Recently, Ping An Bank announced that according to the relevant requirements of the Peoples Bank of China, it has completed the business and system docking with legally qualified clearing institutions, and completed all the relocation of the payment agreement. At the same time, according to the new transfer and liquidation mode, the signing of business agreements and partial business migration of network payment services such as gateway payment, Commercial Commission payment, payment and authentication payment have been completed, and the conditions for complete business migration have been met. In accordance with the overall arrangements and requirements of the regulatory bodies, the Internet Federation and the UnionPay, we will complete the work of direct connection in a timely and comprehensive manner.

According to the incomplete statistics of the correspondent of the Securities Daily, there are five banks that have issued the announcement directly except Ping An Bank. They are CITIC Bank, Everbright Bank, Postal Savings Bank, Bank of China and Bank of Communications. Among them, CITIC Bank announced on July 31 that it would close the fast payment interface of direct connection mode, and several other banks subsequently announced that they would disconnect in September and November.

In fact, according to the Notice of the Payment and Settlement Department of the Peoples Bank of China on the Transfer of Network Payment Business of Non-bank Payment Institutions from Direct Connection Mode to Internet Platform issued by the Payment and Settlement Department of the Central Bank in August 2017, it is clearly required that since June 30, 2018, all online payment businesses involving bank accounts accepted by payment institutions are processed through Internet Platform.

According to the feedback from banks, the time for payment institutions to complete the cut-off of direct bank connections to the Internet is obviously much longer than the deadline given by the central bank in August last year. A third-party payment agency insider told the Securities Daily reporter that many payment agencies had a wait-and-see attitude when they first came out to disconnect the timetable. In addition, there were many factors such as volume of business and more work needed to be coordinated by all parties. We can see that banks with more ports have not completed the disconnection work at present.

In addition to the disconnection, the interest income from the reserve fund of the payment institution will also be cut off in January next year. The Payment and Settlement Department of the Central Bank issued the Notice on the Relevant Work of Removal of RMB Reserve Accounts by Payment Institutions, requiring the Payment Institutions to revoke RMB Customer Reserve Accounts by January 14, 2019, which also means that the Payment Institutions can no longer make profits from the deposited funds.

At the same time, the Circular of the General Office of the Peoples Bank of China on the Concentrated Deposit of Customer Reserves of Payment Institutions requires that the proportion of centralized deposits of Payment InstitutionsReserves be increased monthly from 9 July 2018 to achieve 100% centralized deposits by 14 January 2019. The deposit time is the second Monday of each month, and the deposit base is the average daily balance of the customers reserve fund in the previous month.

Analytical analysis shows that 100% of the reserve deposit is deposited and managed by the central proprietary account, which will undoubtedly have a greater impact on SMEs. Without taking interest into account, the profits of SMEs will be greatly affected in the short term. For example, remittance once disclosed in the prospectus that the reserve accounts for 36.9% of the total profit income in 2017, but for large payment institutions, especially Weixin and Alipay, although the total amount is expected to account for more than 85%, it is expected that the impact on their overall profits will not exceed 10% because more kinds of profit-making methods have been developed.

Source: Liable Editor of Securities Daily: Yao Liwei_NT6056