The Central Bank of China has announced a new regulatory system for the blockchain industry. Fintech product certification will have the authority to approve the use of 11 types of financial hardware and software technology used in the crypto and blockchain fields.
The central bank has launched the first list of fintech products that can be used in both front-end and back-end development for digital payment services,
Fintech certificate valid for 3 years
The certification system covers all the products that could be involved in digital payment technologies. These include point-of-sale mobile terminals, embedded application software, front-end software for users and service providers, as well as chips.
The central bank will grant applicants a certification of the Fintech product (CFP), which must be renewed every 3 years.
To obtain the Fintech certificate, the products must undergo a prototype evaluation and on-the-spot checks. The certificate will be reviewed and renewed every three years, according to the bank.
The related authorities would conduct random inspections at any stage of the production process to ensure compliance while the certificate is valid. Institutions will be allowed to print the certificate on their logo. However, certification cannot be used for direct product promotion or advertising.
An impetus for the development of blockchain-based technologies
The new regulatory system comes at a time when China is accelerating the development of new financial infrastructure. These include a digital version of its currency and a recommendation from President Xi Jinping to capitalize on blockchain technology.
Currently, the Central Bank of China is launching a national digital currency (CBDC) that would boost the digital payments industry. This would represent a direct competitor for the financial services provided by Alipay and WeChat Pay.