China Approves Plans to Strengthen Regulations for Payment and Fintech Sectors

China's central government has approved plans to standardise and develop new regulations for the payments and fintech sectors, which includes enhanced regulations for major payment platforms.

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China will seek to improve regulations over the sector, make up for shortcomings in supervision, and prevent systemic financial risks, the government said, calling for the "complete inclusion of payments and other financial activities within regulation".

The regulations will require fintech companies to place a greater focus on serving the real economy and ensure all forms of financial activity in China are licensed. The government will also enhance oversight of financial holding companies and financial institutions with stakes held by platform firms.

As part of the plan, China will seek to ensure the security and healthy development of payment and financial infrastructures, while also working to prevent and defuse systemic financial risks.

The plan, approved by Chinese President Xi Jinping at a high-level meeting on 22 June, follows a protracted crackdown on China's Internet platforms which first kicked off in 2020. 

The meeting also approved plans to establish a data infrastructure system to promote a standardised data trading market and the proper classification and grading of data. The system will clearly define data rights and ensure the authorised use of public, business and personal data.