January 4, 2018
Chinese consumers have taken to mobile payments, both in-store and online, much quicker than their U.S. counterparts. The technology driving a growing share of those payments in China, however, has remained largely unregulated until now. On Dec. 27, China’s central bank announced regulations affecting QR code-based payments aimed at reducing fraud in the system and protecting consumer data. Headlining the changes, static QR code transactions will have a hard limit of Rmb500 ($76.52) per person, per day.
The growing popularity of mobile payment apps from Alibaba and WeChat forced the government’s hand. From an e-commerce perspective, the People’s Bank of China noted several fraud risks in its announcement, including the ability to capture payment voucher displays and link malicious code into bar codes.
When the regulations take effect on April 1, banks and non-banks offering QR-code-based payments will be required to implement encryption and tokenization, anti-counterfeit measures and increased fraud screening, among other steps.