Virtual Credit Cards Banned in China by Central Bank

The People’s Bank of China has banned issuance of virtual credit cards and also QR codes based payments, a report from 21st Century Business Herald says.

The bank said that it will further study the virtual credit card business model with relation to protection of information and identification of customer.

The central bank has also called the QR codes based payments as unconventional and said that it is an information security risk as well as financial security risk for the consumer.

This decision of China Central Bank is going to affect Tencent and Alibaba Group.

Both of the companies had announced their plans to launching their virtual credit cards and embedding them into their wallet apps for mobile. Tencent planned to offer more than 1 million virtual credit cards and Alibaba also had plans to offer about one million of these.

The stock prices of both the companies have taken a hit after this ban.

 

 

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