Virtual Credit Cards Paused, Not Stopped in China

ZeroHedge had this up in late evening EST.
Chinese Authorities Halt Virtual Credit Card Payments; Tencent, Yahoo Crashing

This afternoon, 21st Century Business Herald reports that the virtual credit cards are halted, not stopped, because central bank officials only learned about them from the flurry of media stories out in the past few days.

Google Translation:
21 Exclusive decryption: Why is the central bank "pause" Virtual Credit Card?

Core Tip: the 13th central emergency dispatch pause a virtual credit card business, 21st Century Network was informed by officials from the central bank, the central bank had on the public-facing Alipay, Tencent network virtual credit cards issued regarding the ignorant. Alipay and Tencent did not advance to the central filing the relevant circumstances. The central bank is at 15:00 on March 13 more than the document issued to Hangzhou and Shenzhen branches of the central bank, there should not yet been issued to the relevant third party payment agencies.
21st Century Network exclusive report on March 13, the central bank of a 21st century network access to internal documents show, send urgent documents "under the People's Bank of China Bank Payment and Settlement Division comments on the suspension of payments under business Bowes line barcode (QR Code) payments The letter "halt Alipay, Tencent's virtual credit card products, but stopped there barcode (QR Code) payment and other payment services face to face.

The central bank is at 15:00 on March 13 more than the document issued to Hangzhou and Shenzhen branches of the central bank, there should not yet been issued to the relevant third party payment agencies.

Central bank notification said that the line barcode (QR Code) paid to break the traditional business model craft terminal, which is directly related to the level of risk control information security and safety of customer funds. Virtual Credit Card credit card to break the existing business model in implementing customer identification obligation to protect customer information security pending further study.

In the notice requirements of the Central Bank, to immediately suspend the line barcode (QR Code) under payment, virtual credit card related businesses, to take effective measures to ensure the smooth transition of the business during the suspension.

21st Century Network call the first time the central bank, the central bank payment and settlement company officials confirmed this file, said the central bank has issued a document is indeed an emergency suspension of Alipay, Tencent virtual credit card business.

However, the officials repeatedly stressed that the 21st Century Network virtual credit card, the central bank is "pause" rather than "halt", "Pause is your first wait, wait for us to figure out to say."

He further said that for the two-dimensional code, including payment, including innovative business virtual credit card, related to a number of new technologies, new processes and new identification technologies, such as risk assessment, consumer recognition, in the traditional the rule is not covered, the central bank needs to further clear.

The official admitted that the central bank had on the public-facing Alipay, Tencent network virtual credit cards issued without the knowledge of the issue and said that the central bank is also seen media reports to know Alipay, Tencent made a virtual credit card products not previously be reported to the central bank.

The official revealed that the central bank has issued a document requiring payment Bowes before March 31 will be "relevant product details, content management systems, operational processes, institutional cooperation and profit distribution mechanism, customer rights protection mechanisms, emergency response, such as" a written report to the territorial supervision of banks.

The official website revealed the 21 century, the document belongs to the central bank internal documents, according to the principle of territoriality of banking supervision, the central bank is at 15:00 on March 13th more than the document issued to Hangzhou and Shenzhen branches of the central bank, there should also not issued to the relevant third party payment agencies. This information is also confirmed from the side Alipay why Tencent response has not yet been received the message.

Finally, the officials made it clear that the Bank of Internet financial innovation supportive, have been mentioned in the government work report, no doubt, but there will certainly be among the innovation risk, it is also unavoidable. Regulatory responsibility is to encourage innovation, how to maximize the prevention of systemic risk that is ultimately to protect the interests of consumers and the stability of the entire financial system.