Nov 11 deals to coast on Net­sUnion tech

China Daily (Canada) - - VIEWS - By WANG YANFEI wangyan­fei@chi­

Net­sUnion Clear­ing Corp, China’s newly es­tab­lished clear­ing house for on­line pay­ments su­per­vised by the Peo­ple’s Bank of China, will clear half of the trans­ac­tions that are ex­pected to be made dur­ing the up­com­ing Nov 11 Sin­gles Day shop­ping fes­ti­val.

The move comes as a blow to Alibaba-owned Ali­pay, which had hith­erto cleared most of the trans­ac­tions dur­ing the shop­ping ex­trav­a­ganza.

China’s cen­tral bank had de­cided to set up the na­tion­wide clear­ing house for on­line pay­ment ser­vices to pro­tect con­sumers and the fi­nan­cial sys­tem from the mush­room­ing in­ter­net-en­abled model of fi­nance that cur­rently ac­counts for over 3 per­cent of the coun­try’s non-cash pay­ments.

Net­sUnion Clear­ing Corp is ex­pected to di­rectly chan­nel 50 per­cent of the trans­ac­tions on Nov 11 be­tween third-party com­pa­nies and banks, thereby slash­ing ac­cess to third-party pay­ment giants such as Ali­pay. The vol­ume of trans­ac­tions that would be cleared on Nov 11 is ex­pected to be the high­est that the clear­ing house would process on a sin­gle day since it started op­er­a­tions in March this year.

“Net­sUnion will only process 50 per­cent of trans­ac­tions on Nov 11, be­cause es­tab­lish­ing the in­fra­struc­ture for clear­ing ser­vices takes time,” said a man­ager in charge of the tech­nol­ogy depart­ment of the Net­sUnion, who did not want to be named.

“The com­pany will take over all the clear­ing ser­vice from Ali­pay in the fu­ture, and also from other third-party pay­ment providers, as re­quired by the cen­tral bank.”

The same stan­dards and rules will ap­ply to all pay­ment providers, said an­other man­ager with the com­pany.

All pay­ment trans­ac­tions han­dled by third-party providers, if re­lated to bank trans­ac­tions, would be routed through the new clear­ing­house by the end of June 30 next year, ac­cord­ing to a doc­u­ment is­sued by the cen­tral bank.

Eigh­teen large Chi­nese banks are con­nected with the clear­ing house, while nine of the 115 li­censed third party pay­ment providers in the coun­try have started to chan­nel trans­ac­tions through the new plat­form, ac­cord­ing to the peo­ple fa­mil­iar with the mat­ter.

By the end of this year, at least 200 banks and 40 com­pa­nies are ex­pected to con­nect with the clear­ing house, the peo­ple said.

The amount of trans­ac­tions chan­neled through the

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