TAIPEI - TAIWAN | The Ministry of Economic Affairs (MOEA) yesterday granted permission for Allpay Financial Information Services Co., Ltd. (歐付寶) to conduct cross-border online transactions and to provide foreign exchange settlement services to the public.
Allpay, a subsidiary of game developer MacroWell OMG Digital Entertainment Co. (歐買尬), is a local third-party payment solution provider. With the MOEA's approval, local consumers may make purchases on sites like Taobao Marketplace (淘寶網), China's largest consumer-to-consumer (C2C) portal, without the hassle of finding someone else to make payments on their behalf.
A third-party online payment solution is essentially an escrow payment service. Shoppers have the ability to verify whether they are happy with goods they have purchased before releasing funds to the seller. Paypal of the U.S. and Alipay (支付寶) of China are two of the largest online payment service providers in the world.
Local consumers will be able to make foreign currency deposits and settlements via the payment platform provided by Allpay. In the future, making purchases on Taobao Marketplace will be as easy as making purchases on local online stores, MacroWell said. Similarly, with Allpay's transaction platform, Taiwanese Web stores may sell to Chinese consumers, who are used to making payments through Alipay and Shenzhen Tenpay Co. (財付通).
Allpay has partnered with Alipay and Shenzhen, the two largest third-party payment solution providers in mainland China. In addition to online stores, Allpay could potentially work with a variety of businesses that need a third-party payment solution. Brick and mortar businesses, conference event sponsors, live music performance venue providers as well as private bed and breakfast owners may all use the online transaction platform.
Allpay Gains the Lead
In addition, Allpay is providing its third-party payment solution system to local banks that are interested in offering third-party payment or cross-border payment services.
Allpay is currently working with First Bank to provide the payment service, and is negotiating to do so with the Land Bank of Taiwan, Taiwan Cooperative Bank, Hua Nan Bank, Cathy United Bank, Taishin Bank and Cosmos Bank. Allpay may provide the payment system through leasing, outright sale or system implementation.
MacroWell stressed that Allpay is the only local third-party payment solution provider which has a membership service as well as offers inbound and outbound cash services. Judging by the MOEA's review and verification process, a sound third-party payment framework must have five components: inbound and outbound cash services, a multiple cash flow mechanism, escrow service (fulfillment guarantee or placement under trust), secure transaction mechanism and early arbitration assistance service.
PChome Online Inc. (網絡家庭) was another serious contender to offer the third-party payment service. The Financial Supervisory Commission (金管會) previously announced that only banks may participate in the online stored-value business, which was severely criticized by PChome Chairman Jan Hung-tze (詹宏志), who said that the practice goes against international standards.
There was an uphill battle for local businesses to gain permission to offer the third-party payment services. Former FSC Chairman Chen Yuh-chang (陳裕璋) was recently replaced since he was unwilling to grant approval, sources said.
Sourced from: The China Post, August 7th 2013
Author: John Liu