China’s central bank tightens security in US$5.5 trillion QR code payment services
From April, high-value transactions will be subject to multi-level verification, as service providers told to better protect users
China’s mobile payment services will be subject to tighter security from next year as the central bank seeks to maintain control in the rapidly expanding hi-tech sector.
Under new rules released by the People’s Bank of China on Wednesday, all transactions over 500 yuan (US$76) will be subject to additional levels of verification. As the transaction value passes each trigger point – 1,000 yuan, 5,000 yuan and unlimited – so the security checks will increase.
While the document did not stipulate the exact methods payment service providers should use to verify a consumer’s identity, they are likely to be the usual combination of passcodes, electronic signatures and fingerprints.
In just a few years, QR-code payment systems have become ubiquitous on China’s mainland, with consumers using them to pay for everything from a bag of rice to a new car. According to internet consulting firm iResearch, US$5.5 trillion worth of transactions – about half the country’s GDP – were conducted via mobile devices in 2016.
As well as the changes to the verification requirements, the new rules, which come into force on April 1, stipulate that all companies providing bar code-based payment services must obtain both an online payment licence and a bank card receipt business licence, and that all cross-bank transactions involving bar codes must be channelled through the PBOC’s or other approved clearing system.