http://online.wsj.com/news/articles/SB10001424052702303949704579458533987293234
China's banks and regulators are pushing back on the success of internet firms who are "elbowing their way onto the turf of the state-run banks". The central bank said that it would set limits on the amount Chinese can spend using smartphone payment services. This move could cut off a multibillion-dollar business for companies such as Alibaba Group Holding and Tencent Holdings Ltd.
The big state banks have already moved to cap the amounts depositors can transfer into online products and Chinese media reports that the central bank had proposed a cap on mobile payments of 10,000 yuan a month. Alibaba Chairman, Jack Ma, had an interesting response:
"What determines success in the market shouldn't be the monopolies and those with power, but the consumers" - Jack Ma
China's regulation of internet firms does seem like an indicator of Beijing's commitment to overhauling state-run enterprises.
The central bank has also temporarily suspended online payments and it has also been suggested that online investment products could be forced to hold reserves on funds they attract.
It is interesting to think about the future of the worlds exchange system. With the internet and increasing new technology people have easy access and availability to services to buy products from or control their personal finances. China seems to be frightened of this since it takes power away from the central bank, it is interesting to think how other countries will respond in the coming years.
1 comment:
It will be very interesting to see if China is the correct indicator of what Beijing's decision will bring. Yes, the world's exchange system is changing, but in the future, will this seem like a huge change?
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