Why are Internet companies keen to pay for licenses? What's the intention

The full name of the payment license is the payment business license. The third-party payment platform can only perform payment-collection-settlement services after obtaining the payment license. It lays the foundation for the development of various derivative financial services such as lending and financial technology, and generates it on the platform. All of the transactions can be completed through its own payment channel.

In recent years, the popularity of third-party payment licenses has not diminished. After Internet giants such as Alibaba, Tencent, Baidu, Sina, JD, NetEase and other Internet giants were approved for payment licenses, Internet companies such as Meituan, Pinduoduo, Bytedance, Kuaishou, and Huawei have been approved. The payment license was also obtained through acquisition. The third-party payment license has become a standard for the development of Internet companies.

On November 19, 2021, Ningbo Hengshun Auction Co., Ltd. released the Yuyao China Plastic City Logistics Co., Ltd. property rights transaction announcement. According to the announcement, Zhejiang Yongyi Electronic Payment Co., Ltd. owns 65.5% of the state-owned equity. The video platform Bilibili bilibili The operator, Shanghai Kuanyu Digital Technology Co., Ltd., was auctioned and the transaction price was RMB 117,965,500. This means that Bilibili has officially obtained a payment license. It is worth mentioning that since 2020, many Internet companies have obtained payment licenses through equity acquisitions. In January 2020, Shanghai FFT Information Service Co., Ltd. completed the change of industrial and commercial information. Shanghai Yiyi Information Technology Co., Ltd. became the largest shareholder with a shareholding ratio of 50.01%. The legal representative and actual controller of the company is the founding of Pinduoduo. Chen Lei. In August 2020, Wuhan Hezhong Yibao Technology Co., Ltd. completed the industrial and commercial change, the original shareholder Zhongfa Industry (Group) Co., Ltd. withdrew, Tianjin Tongrong E-Commerce Co., Ltd. became the sole shareholder of Wuhan Hezhong Yibao, and Tianjin Tongrong Electronics The actual controller of Business Co., Ltd. is Zhang Yiming, the founder of Bytedance. This means that Bytedance has indirectly won a payment license, and its products such as Toutiao, Douyin, and Watermelon Video are also equivalent to obtaining a payment license. In November 2020, Kuaishou acquired Yilian Pay in the form of cash + stocks. The cash consideration was about 300 million yuan, and the amount and value of the stocks were unknown. After the completion of the acquisition, Kuaishou will hold more than 50% of the shares and become the largest controlling shareholder of Yilian Pay. In March 2021, the third-party payment company Shenzhen Xunlian Zhipay Network Co., Ltd. undergoes business and commercial changes. Shanghai Wo Ruiou Information Technology Co., Ltd. withdrew from the shareholders, and Huawei Technologies Co., Ltd. became the sole shareholder of Xunlian Zhipay. Three-party payment license.

What is a payment license?

So, why are these Internet companies so keen to pay for licenses? Before that, let's first understand what a payment license is. The full name of the payment license is the payment business license. Only after obtaining the payment license can the third-party payment platform be able to perform related payment-collection-settlement services, laying the foundation for the development of various derivative financial services such as lending, financial technology, and generating on the platform All of the transactions can be completed through its own payment channel. In June 2010, the "Administrative Measures for Non-financial Institutions on Payment Services" promulgated by the People's Bank of China stipulates that a third-party payment license is required to engage in payment services, also known as the "Payment Business License." Data show that from May 2011 to March 2015, the central bank issued a total of 271 payment licenses. Among them, 101 licenses were issued in 2011, 96 were issued in 2012, 53 were issued in 2013, 19 were issued in 2014, and 2 were issued in 2015. However, since 2016, the central bank has stated that in principle, it will no longer add new payment licenses. As of December 2020, the total number of payment licenses owned by non-bank financial institutions is 233. As the third-party payment license enters the era of stock, its value is becoming more prominent.

What does it mean for Internet companies?

1. Avoid the risk of secondary clearance. The second clearing is that it has not obtained the payment business license of the central bank, but actually engages in the payment business under the licensed acquirer. Obtaining a payment license is the most direct solution, which not only helps avoid potential compliance risks, but also provides support for future compliance operations.
2. Reduce costs. Internet companies build their own payment channels through payment licenses, which can reduce their dependence on other platforms, while saving huge payment processing fees and reducing costs.
3. Accumulate large amounts of data. Having a payment license means that you can control important data such as order information, total transaction amount, and payment information in your own hands. And can realize the realization of the value of data by mining, including customer group portrait, card and coupon marketing, etc., to find out the user's trading habits, and realize innovative marketing.
4. Build a financial ecosystem. Payment is the underlying support for the circulation of financial business transactions. Obtaining a payment license will promote the deployment of Internet companies in the financial business sector. With payment as an entrance, it connects C-end users and B-end merchants, and gathers various resources to create a financial ecosystem. In recent years, with the development of the Internet and the application of smart phones, the scale of online payment users in my country has continued to expand. According to the 47th "Statistical Report on Internet Development in China" issued by the China Internet Network Information Center (CNNIC), as of December 2020, the number of online payment users in my country has reached 854 million, an increase of 86.36 million from March 2020, accounting for netizens. The overall 86.4%. It can be said that in the face of such a vast payment market, the importance of payment licenses to Internet companies is self-evident.

Written at the end:

As Internet companies improve their business development, the payment field has become a new battlefield for all companies to pursue. Of course, when Internet companies obtain a payment license, they only have a ticket to enter the payment field. After that, whether it can bring new growth points to itself through payment business is still unknown. In the future, it is worth looking forward to how the competitive landscape of the Internet industry will be written.