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China NetsUnion clearing (NUCC)

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https://ftalphaville.ft.com/2019/01/07/1546853764000/Will-fintechs-sink-or-swim-when-floats-are-regulated-/

 

"Since June 2018, fintechs must also channel payments through a newly authorised clearing house, NetsUnion, (graph 7 above) in a bid to enable the PBoC to better monitor customer funds on third-party payment platforms.

What's interesting about the changes being imposed in China is how they marry up with narrow-banking inclined responses to fintech and crypto challenges elsewhere, especially attempts to introduce a central bank digital currency (CBDC). (More on that in a follow-up post.)

The 100 per cent reserve rule, for example, will see fintechs' "payments" float segregated in a specific reserve at the PBoC, preventing it from being rehypothecated or invested onwards for interest return. Once at the PBoC the reserves will earn no interest.

Carstens says this is unusual because the fintechs are not banks. But compare and contrast that to the Fed opening its balance sheet to MMFs, albeit with a different agenda -- to stop them crowding out the safe asset market, which was pushing negative interest rate territory as a result. Zero interest in this case providing a floor on returns rather than a cap."

 

Fintech refers as Alipay and other similar systems.

 

Is someone has made researchs about it and found a link with our prefered company? The link could be on the upper level with the PBoC or inexistant. In this case it would probably be invisible to us.

 

Regards,

Toolate

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Posted (edited)

Didn't read that link, but this is very likely a response to the huge domestic credit bubble in China.  On the consumer side, alone, they have like ~500 "p2p lending" companies on their hands, most of which are of the "2 guys in Guandong" variety, which have taken in tremendous amounts of money from the public and which when the public wants it back, only to find that the companies stole it all or that their idea of underwriting was ... naive ... then they have to stop the trains full of investors from joining the bigger riot, in Beijing, where the people expect the government to bail them out of whatever harebrained scheme they bought, because there's no such thing as a non-state-owned-enterprise in China.  In the same way, they're probably trying to stop a bunch of harebrained "payments" companies from playing the float - by investing it into triple-AAA prime fentanyl notes or something - by forcing them to deposit it all at PBoC, so that they can "keep an eye on it"... (and use the float, themselves, to shore up the 9000 other crazy-assed things they're busy doing, OBOR).

This has almost nothing to do with crypto (except maybe explaining why they didn't want their citizenry to participate) or with CBDC or whatever you're about to try to tie it into...

It has everything to do with China being... China.

Edited by NightJanitor

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Didn't read that link, but this is very likely a response to the huge domestic credit bubble in China.  On the consumer side, alone, they have like ~500 "p2p lending" companies on their hands, most of which are of the "2 guys in Guandong" variety, which have taken in tremendous amounts of money from the public and which when the public wants it back, only to find that the companies stole it all or that their idea of underwriting was ... naive ... then they have to stop the trains full of investors from joining the bigger riot, in Beijing, where the people expect the government to bail them out of whatever harebrained scheme they bought, because there's no such thing as a non-state-owned-enterprise in China.  In the same way, they're probably trying to stop a bunch of harebrained "payments" companies from playing the float - by investing it into triple-AAA prime fentanyl notes or something - by forcing them to deposit it all at PBoC, so that they can "keep an eye on it"... (and use the float, themselves, to shore up the 9000 other crazy-assed things they're busy doing, OBOR).
This has almost nothing to do with crypto (except maybe explaining why they didn't want their citizenry to participate) or with CBDC or whatever you're about to try to tie it into...
It has everything to do with China being... China.
So no BG123 2000$ + by May?! /s

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@Nightjanitor I understand the context in China.

My only question is,
Is there a connexion with this important centralized hub using instant payments?

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