Licence to make money is on the cards
Prepaid gift cards is a lucrative business in the mainland and firms such as China Innovationpay are set to profit from it
A group of former high-level mainland bankers and regulators recently injected the new business into the Hong Kong-listed company, which used to be known as Syscan Technology.
The idea originates from the fact that Chinese people love giving gifts to one another. Rather than presenting someone with an envelope full of cash, why not put the money in a card that can hold up to as much as 100,000 yuan (HK$122,344) and be used at exclusive malls?
"The person who buys a prepaid card often is different from the person using it," said Cao Chunmeng, chief executive of China Innovationpay.
The industry has come under scrutiny in recent years because of the "grey areas" of business in which its products may be used.
"This is a twisted industry, and very often people buy such cards intending to use them for bribery," said Liu Shengjun, deputy director of the China Europe International Business School's case centre in Shanghai.
Bribery, Cao conceded, is a potential issue that could hurt the development of the business. But he said side effects should not cripple a good invention.
