The People's Bank of China, or China's central bank, yesterday granted licenses to the first batch of 27 non-financial institutions, including Alipay and Tencent's Tenpay, to allow them run third-party payment services.
The institutions included Alipay, a unit of Alibaba Group which owns China's largest e-commerce website Alibaba.com, 99bill.com, Tenpay.com, which is a e-payment platform launched by Chinese internet giant Tencent , and Shenpay, which is owned by Shanda Interactive Entertainment Ltd.
"The market will become more mature, and more players will be allowed in this sector," said researcher Zhang Meng at Analysys International.
There will also be more service providers in various segments of the market such as insurance and asset management, she added. Any applicant for the nationwide payment platform is required to reach a registered capital of 100 million yuan (US$15.4 million) while regional payment operators need to have 30 million yuan.
Alipay and Tenpay have a registered capital of 500 million yuan each.
All third-party payment service providers are required to gain a new business license from the People's Bank of China by August 31, according to an announcement in June last year. The services will be shut down if they fail to acquire one.
China's online payment market totaled 397.3 billion yuan in the first quarter of this year, with Alipay owning 45.5 percent of the market, Tenpay's 20.3 percent and China UnionPay's 11.7 percent, accroding to Analysys.