Powered by AI, automated trading algorithms are rapidly taking over the financial world. Because they are safe and can provide stable returns, AI investment platforms Wealthfront and Betterment have attracted millions of investors to join.
Cover news reporter Zou Ajiang Yang Lan
Once upon a time, wired headphones were replaced by Bluetooth headphones. But now, this product is returning to young people’s vision as a new “fashion accessory”.
Recently, "wired headphone outfits" have become so popular on social media that sales have doubled in many digital stores. Once eliminated due to "trouble", why can it "make a comeback" and become a fashionable item that relieves battery anxiety and highlights individual aesthetics?
On April 1, Hu Penghui, associate professor and master's tutor at the School of Social Sciences at Huazhong University of Science and Technology, told Cover News reporters that the surge in popularity of wired headphones reflects the individual expression of the youth group. They began to reject authority and standardization and seek individuality and differentiation.
Popular wired headphone outfits on the Internet
High-looking wired headphones become fashion accessories
Open social platforms such as Xiaohongshu and search for "wired headphone outfits", and there are more than 100,000 related notes. In the photo, the protagonist wears wired headphones, mixes them with metal necklaces and trendy clothes, and turns out to be the most conspicuous "cyber accessory" in front of the camera.
Xiao Chen, a 22-year-old senior student, is one of the participants in this trend. She keeps three pairs of wired headphones in her bag all year round - a white original model with a simple style, a transparent purple one to echo the dopamine outfit, and a retro braided cord specially matched with the Y2K (millennium style) look. "Wired headphone cables are like accessories, they help me complete the entire look."
Xiao Chen’s headphone combination
According to Mr. Zhang, a commuter, wired headphones are chosen because of practicality. "Compared with wireless earphones, it is cheaper and you won't have battery anxiety when you go out. You can plug it in and use it. This certainty makes people feel more at ease."
What’s even more interesting is that this thread can be “redesigned”. Some people perform hand-plating, stickers, and wire wrapping modifications on wired earphones, treating them as DIY jewelry; some people directly wrap the earphones around their wrists as bracelets, tie them in braids as hair ropes, and even wear them on top of each other like beads. Many netizens said that wired headphones have changed from a music listening tool to a malleable fashion material. Like sunglasses, mini bags and other items, they have come back with an "attitude".
DIY braided wired headphones
The wired headphones costing more than 30 yuan were sold out within three days of being put on the shelves.
The trend is still translating into real money sales.
Data from multiple e-commerce platforms show that searches for “good-looking wired headphones” have doubled in the past month, and niche brands focusing on retro designs have begun to appear frequently in live broadcast rooms. "Reverse consumption" driven by young people has allowed wired headphones, which were once marginalized, to return to the center of the trend stage.
On online shopping platforms, the price of wired headphones ranges from tens to hundreds of yuan. It specializes in high-looking designs such as pure white, transparent shells, and macaron colors, attracting young people who are looking for fashionable clothes. Some popular models are often out of stock.
Lin Sen (pseudonym), the owner of a digital collection store in Chengdu, told reporters that the sales of wired headphones in the store have tripled in the past three months, and 70% of the buyers are women between 18 and 25 years old. "In the past, when I entered the store, all I asked was 'Is the sound quality good?' But now the first questions asked are 'Are there any wired ones?' and 'What color is the best?'" he said, pointing to the newly arrived wired headphones on the shelf. "This batch of goods was almost sold out within a week of arrival."
“Headphones costing more than 30 yuan are actually out of stock!” Consumer Lulu (pseudonym) told reporters that she took a fancy to a polka-dot pattern wired headset, which was sold out within three days of being put on the shelves. "The appearance is too good, and it is basically designed to match Y2K (millennium style), and the sound quality has become a secondary item." In addition, the reporter noticed that this craze has even given birth to the DIY economy. On Xiaohongshu, the "Knitting Wired Headphones" tutorial has been viewed over one million times.
Hot-selling wired headphones for over 30 yuan
Expert opinion:
Wired headphones become a possibility for young people to express their personality
Why have wired headphones, which have “disappeared” from the public eye for many years, returned to the public eye? In this regard, Hu Penghui, associate professor and master's tutor at the School of Social Sciences at Huazhong University of Science and Technology, conducted an analysis.
He told reporters that this phenomenon can be understood from the perspectives of practicality, niche, and evolution of consumption logic.
"Practiceability is the basis. The low price of wired headphones, no need to charge, sound quality, and no sense of delay are all features and advantages that wireless headphones cannot match. This makes the majority of users not feel distressed when losing their headphones, have no anxiety about charging when using them, and can still enjoy high-quality music."
Hu Penghui said: "There is also a very important historical background here. Wired headphones have disappeared for a few years and have now become a niche 'rare product'. Especially for the post-00s and post-10s generations, this is even more rare. So, in today's era when young people begin to reject authority and standardization and seek individuality and differentiation, wired headphones have the possibility to become an expression of individuality."
"Although today's society is still what Baudrillard said is a consumer society, the entire logic of consumption has changed." He believes that the youth group is no longer "led by the nose" by mainstream capitalism, but places more emphasis on individual initiative and resistance - to resist "consumerism" and build a "minimalist lifestyle."
Therefore, the craze for wired headphones reflects the young people’s preference for cost-effective and practical items. To a certain extent, it shows that the consumption logic of young people has begun to show a pragmatic turn. At the same time, young people who pursue personalization will increasingly prefer niche products.
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On March 31, 2026, Lu Wei, a professor at the School of Economics of Dongbei University of Finance and Economics, published a theoretical article "Accelerating the Construction of China's Independent Knowledge System of Finance" in the 01 edition of the "Chinese Social Sciences Journal".
The full text is below.
Accelerate the construction of China’s independent knowledge system of finance
Lu Wei
General Secretary Xi Jinping pointed out that we must focus on building philosophy and social sciences with Chinese characteristics in accordance with the idea of based on China, learning from foreign countries, exploring history, grasping the present, caring for mankind, and facing the future. Accelerating the construction of philosophy and social sciences with Chinese characteristics is ultimately the construction of China’s independent knowledge system. To build China's independent knowledge system of public finance, we need to deeply cultivate local practice, adhere to dialectical thinking, historical perspective and problem orientation, and continuously promote knowledge innovation, theoretical innovation and method innovation in public finance.
Broaden the perspective of financial research with dialectical thinking
To build China's independent knowledge system of finance, we should adhere to the principle of serving the past for the present and foreign knowledge for China, grasp the resources of Marxism, the resources of China's excellent traditional culture, and the resources of foreign philosophy and social sciences, and broaden the perspective of finance research on the basis of comparison, contrast, criticism, absorption, and sublimation.
Use Marxist methodology to analyze China's fiscal phenomena. More consciously adhere to and use the dialectical materialist worldview and methodology to study major theoretical and practical issues in the fiscal field. On the one hand, we must adhere to the perspective of practice first, understand China's basic national conditions and economic development stage characteristics from objective reality, and use this to dialectically analyze the internal logic of fiscal phenomena. On the other hand, we must grasp the basic principles of the contradictory movements of things and persist in observing things in a developmental, comprehensive, systematic, and universally connected manner, so as to understand the complex interest relationships and deep-seated contradictions behind financial phenomena. For example, from the complex relationship of multiple co-governance, we can understand the architecture and core content of the modern budget system.
Draw on the financial ideas from China’s excellent traditional cultural resources. Drawing financial wisdom from China's excellent traditional cultural resources is crucial to understanding the profound historical origins and broad realistic foundation of China's independent knowledge system of finance. The difficulty lies in how to excavate the cultural spirit that spans time and space, transcends countries, is full of eternal charm, and has contemporary value, so that it can be used to guide modern fiscal practice through creative transformation and innovative development. The concept of using frugality to enrich the people can be traced back to the idea of "using frugality to benefit the people through propriety and enriching the people through politics" in "Xunzi Fu Guo" in the pre-Qin period. It advocates using the etiquette system to save money on national fiscal expenditures and using decrees to reduce taxes and enrich the people. To correctly understand the current underlying logic of using money sparingly to enrich the people, we must combine the party and the government's leadership in living a tight life with allowing the people to live a good life. We must understand that the purpose of saving money is to maximize social benefits and people's livelihood benefits from limited financial resources.
Absorb and learn from useful perspectives and academic achievements in foreign finance. Constructing China's independent knowledge system of public finance must not only be based on the country's reality, but also open to research and absorb foreign theories, concepts, discourses, and methods in an analytical and critical manner. From a research theory perspective, the views of different financial scholars and different schools should be examined and grasped as a whole, so as to fully understand the true ideological connotations of different theoretical branches. Following the thinking path of phenomena-problems-theories-concepts, we explore the logical deduction process behind the existing theories of Western finance, apply good thinking methods to analyze Chinese fiscal phenomena, and conduct abstraction and generalization based on solid empirical research. From the perspective of research tools, compared with the use of quantitative methods themselves, the key is to extract China's unique propositions from realistic observations.
Clarify the rules of financial practice based on the big historical perspective
To build an independent knowledge system of Chinese finance, we should adhere to the macro-historical view, analyze the evolution mechanism and explore the historical laws from the long history, the tide of the times, and the global situation, and form a comprehensive understanding of the laws of China's fiscal operations, the laws of the behavior of fiscal subjects, and the laws of the reform of the fiscal system.
Compare "self" with "others" and observe China's financial operating rules from a global perspective. To build an independent knowledge system of Chinese finance, it is necessary to pay attention to the national character while continuously improving its global influence. On the one hand, to understand China’s fiscal operations, we need to place it within the larger world history to derive its particularity and universality. On the other hand, building an independent knowledge system of Chinese finance should break through a single cultural perspective and achieve innovative development in dialogue with world civilizations. For example, based on a global perspective, we understand that "finance is the foundation and important pillar of national governance." China and the West have constructed different fiscal systems in the process of moving toward a modern state. Through connection and comparative analysis of the selection of fiscal tools, institutional arrangements, and legitimacy that serve the realization of state functions, we can further think about the direction, path, and motivation of China's move toward a modern state, as well as the inherent connection between finance and national governance.
"Broad" and "subtle" are connected to reveal the behavioral rules of financial subjects from the depth of history. Human beings are the subjectivity, initiative and creative force of historical development. The construction of China's independent knowledge system of public finance should combine grand historical narratives and micro case studies, and deeply analyze the behavioral choices and interactive relationships of different subjects. To understand the current deployment of increasing local autonomous financial resources and further standardizing local government economic promotion behaviors, we can analyze how changes in power allocation, incentive direction, and pressure structure affect local government behavior from the perspective of institutional arrangements and policy adjustments.
"History" and "reality" are connected, and the laws of fiscal system reform are summarized from the development trends. Observing historical China is an important perspective from which to observe contemporary China. Building an independent knowledge system of Chinese finance should sort out the laws of reform in the continuity and progress of historical development. On the one hand, the study of history cannot cut off the internal connections of history, and the experience of fiscal reform should be summarized from the practical exploration of socialist construction. When analyzing the design of fiscal systems and mechanisms in different historical periods, we must understand their historical role and rationality on the basis of fully considering the ideological, material, institutional and other conditions at that time, and dynamically observe the formation and evolution of the system. On the other hand, reform, development, and stability are the main threads for understanding China’s development trends and the laws of fiscal system reform. Building an independent knowledge system of Chinese finance requires an in-depth explanation of the relationship between finance, reform, development, and stability.
Promote fiscal theory innovation with a problem-oriented approach
Excavate new materials, discover new problems, propose new perspectives, and construct new theories from the practice of China's reform and development, and scientifically answer questions about China, the world, the people, and the times with original theories.
Go deep into China's issues and analyze the unique role of finance in Chinese modernization. The realistic requirements of accelerating the establishment and improvement of a fiscal system that is compatible with Chinese-style modernization point to the construction of an independent knowledge system of Chinese fiscal science. We can focus on the Chinese characteristics, essential requirements, important principles and major relationships of Chinese-style modernization, carry out theoretical innovation around the intrinsic relationship between finance and Chinese-style modernization, observe and understand the particularity of Chinese-style modernization from a fiscal perspective, systematically sort out modern fiscal functions that adapt to the needs of Chinese-style modernization, and explore fiscal system reform ideas based on the risks and challenges that may be faced in the process of Chinese-style modernization.
Solve the world's problems and explain the principles of fiscal policy in the context of a century of changes. Promoting economic growth while improving fiscal resilience is obviously a practical problem that needs to be answered urgently in building China's independent knowledge system of public finance. Currently, major changes in the world that have not been seen in a century are accelerating, and the pattern of international cooperation and competition has undergone profound changes. China's development has entered a period in which strategic opportunities and risks and challenges coexist, and opportunities outweigh challenges but uncertainties are increasing. Facing the world's problems of sluggish growth and shifting momentum, fiscal policy urgently needs to play a role in promoting stable and sustainable growth. Building an independent knowledge system of Chinese finance can deeply explore the logical starting point, mode of action and practical results of China's more active fiscal policy, analyze the internal mechanism of fiscal policy affecting economic resilience, and the policy logic of fiscal and financial coordinated efforts to respond to risk challenges, and provide ideas and methods for solving world problems.
Respond to the people's questions and summarize the underlying logic of finance in dealing with emergencies and worries. Different from the capital logic of Western finance, the construction of an independent knowledge system of Chinese finance should take the people's nature of finance as its value and clarify the essential characteristics and advantages of China's finance. On the one hand, the construction of an independent knowledge system of Chinese finance should be based on the transformation of the main contradictions in Chinese society, with the comprehensive development of people as the core to analyze the fiscal expenditure structure and policy direction, as well as the historical experience and future ideas of fiscal system reform. On the other hand, building an independent knowledge system of Chinese finance should deeply realize the development logic of the deep integration of people's livelihood improvement and economic development, analyze the intrinsic relationship between "development-oriented finance" and "security-oriented finance", and the positive role played by finance in forming a virtuous cycle of "people's livelihood expenditure-domestic demand growth-economic development-fiscal revenue increase".
Answer the questions of the times and build a new fiscal theory adapted to the digital age. To build an independent knowledge system of Chinese finance, we should fully understand the profound changes in fiscal revenue forms, fiscal and taxation collection and management methods, and government governance models in the digital era, and explore new ideas and new paradigms in fiscal research in the digital era starting from digital technology and the new concepts, new business formats, and new models derived from it. On the one hand, the digital economy is a new economic growth point and a potential area for increasing fiscal revenue. Constructing an independent knowledge system of Chinese finance can focus on the new deployment of the tax system that is compatible with new business formats, combine the development foundation of the digital economy, industrial structure, enabling effects, etc., to study the logic of fiscal revenue and expenditure in the context of digital economicization and economic digitization. On the other hand, digital finance is an important part of strengthening the construction of digital government. The construction of China's independent knowledge system of finance can be based on the digital finance construction experience of Zhejiang, Jiangsu, Guangdong and other provinces, from the perspectives of data elements, system platforms, institutional construction, management innovation, rule of law construction, public participation, etc., summarize the internal mechanism of digital technology empowering scientific fiscal management, and reveal the development trends and laws of digital finance construction.
(The author is a distinguished professor at the School of Economics, Dongbei University of Finance and Economics)
The use of automated trading in financial markets will only increase, replacing humans in day-to-day investment decisions.
According to CFTC data, the dominance of algorithmic trading in various asset classes is increasing, whether in foreign exchange, stocks, crude oil, or metals.
Macquarie Bank pointed out that automated trading strategies (ATS) accounted for 72% of U.S. stock index trading, 72% of international stock index trading, 84% and 70% of G10 currency and U.S. Treasury bond trading, and nearly 60% and 65% of base metals and crude oil trading respectively.
As transactions between machines increase and the human element decreases, Macquarie asks: Do fundamentals actually matter less?
Macquarie said that while it is true that the rules adopted by machines are set by humans, machine learning is proliferating and therefore the direct contribution of humans is declining.
"This also eliminates human 'hesitation' and 'thoughts', and the cumbersome repricing is completed in an instant - no matter which direction, therefore, a 5% increase in volatility is now equal to the new 1%."
Macquarie said this would not only lead to possible increased short-term fluctuations in various assets, but also create a situation where policy statements depend on the reaction of machines rather than human behavior.
"This has significant policy implications because asset prices have become a key variable driving real economic decisions, from consumption to investment." Macquarie said: "When the Fed communicates with the market, it is no longer aimed at people, but aimed at triggering machines and guiding transactions."
With no signs of a slowdown in automated trading in financial markets, one has to wonder whether it is wise to allow machines to determine asset price valuations and economic policy.
According to the British "Guardian" news on March 30, U.S. Secretary of State Rubio has officially issued instructions to U.S. embassies and consulates around the world, requiring them to unite in carrying out external publicity work and make every effort to tell the "American story."
Rubio made it clear in the directive that the X platform is an "innovative" tool to assist the United States in its foreign propaganda, and requires foreign affairs personnel stationed abroad to make full use of the platform to specifically remove "anti-American information" on the platform and strengthen the direction of U.S. foreign public opinion. This directive also makes clear requirements for the cooperation partners of embassies and consulates, stipulating that they must cooperate with the US military's psychological warfare force, the Military Information Support Operations (MISO), to jointly deal with the so-called "disinformation problem."
It is reported that the core function of the Military Information Support Operations (MISO) is to influence the cognition, emotions and behavior of foreign audiences through targeted information transmission to serve the relevant goals of the US government and military. This linkage with embassies and consulates abroad means that the United States will further combine military information operations with diplomatic propaganda and strengthen the control of global public opinion.
The issuance of this directive comes against the backdrop of the military conflict between the United States, Israel and Iraq that has lasted for more than a month. Currently, the confrontation between the United States and Iran in the field of public opinion is equally fierce: the United States accuses Iran of operating the most complex and active "national disinformation machine" in the world, while Iran counterattacks, accusing the United States of being a "professional liar" and carrying out misleading propaganda by repeating "big lies." The public opinion confrontation between the two sides has further escalated.
In addition, Rubio's directive also contains a number of specific requirements, including recruiting local Internet celebrities, scholars, and community leaders to participate in propaganda to give the illusion of "localization" of U.S.-funded content; highlighting the American flag logo in foreign aid to strengthen the spread of "American goodwill"; positioning more than 700 American cultural centers around the world as "free speech zones," which in fact creates a one-way pro-U.S. public opinion circle. It is worth noting that the EU has just fined X platform 120 million euros for "deceptive behavior". At this time, the United States uses this platform as a core tool in public opinion warfare, and its double standards have attracted attention from the outside world.
On October 25, 2019, the China Securities Regulatory Commission issued the "Notice on Piloting the Investment Consulting Business of Publicly Offered Securities Investment Funds" (hereinafter referred to as the "Notice"), marking the official implementation of the pilot project for the investment consulting business of public funds. With the implementation of the buy-side investment advisory model in China, how to develop investment advisory business with high quality and efficiency to meet the wealth management needs of more consumers has become an urgent problem to be solved. Against this background, this report starts from the perspective of global investment advisory business development, analyzes and draws on foreign investment advisory business development experience, and puts forward suggestions for the development of China's investment advisory business.
The development status of foreign investment advisory business
(1) Comparison of foreign investment advisory service models
The foreign investment advisory service model is mainly based on discretionary entrustment, and the proportion of non-discretionary entrustment is increasing to meet the diverse market needs. In addition, richer investment advisory service models such as investment consulting are gaining more and more attention from customers.
1. United States. The investment advisory industry in the United States is booming and plays an important role in residents' wealth management. At the wealth management level, according to statistics from the Federal Reserve, the financial assets of American households in 2021 are US$159.13 trillion. There are 14,806 investment advisory institutions registered with the US Securities and Exchange Commission (SEC), of which approximately 59.8% of investment advisors provide asset management services to individuals; at the asset level, the asset size for individual customers is US$18.906 trillion, accounting for 14.7%. The penetration rate of investment advisory services at the financial asset level for US individual customers has reached 11.88%.
In terms of transaction execution, the assets managed by American investment advisory services are mainly based on the discretionary model. At the same time, non-discretionary investment advisory services have enriched the diversified market needs. In addition to asset management services, non-asset management services such as investment consulting have also achieved considerable development in the United States, and customer demand for investment consulting services has grown strongly. In 2021, 97.2% of investment advisors in the United States provided portfolio management services to clients. At the same time, 61.0% of consultants also provide more diverse investment consulting services to their clients.
2. Europe. In terms of household finance in Europe, the United Kingdom, Germany and France are at the forefront, and the three countries together account for nearly half of the European total. According to data from the European Central Bank, the scale of household financial assets in the United Kingdom, Germany, and France in 2021 will be 8.15 trillion euros, 7.84 trillion euros, and 6.57 trillion euros respectively. The three countries together account for 47.96% of the European total. The penetration rates of investment advisory services at the asset level for individual customers in the three countries have reached 5%, 6%, and 15% respectively.
3. Japan. Japan mainly provides investment advisory services for individuals in the form of wrap accounts, and investment advisory services are developing rapidly. At the wealth management level, according to statistics from the Bank of Japan, the scale of household financial assets in Japan in 2021 is 1,968 trillion yen. The number of Japanese investment advisory service customers and the scale of assets have shown a continuous upward trend. In 2021, the number of Japanese individual customers was 1.336 million, and the scale of customer assets was 12.26 trillion yen. Therefore, the penetration rate of investment advisory services for Japanese individual customers at the asset level reached 0.62%. Japanese investment advisory services are specifically divided into two models: investment management business and investment consulting business. Investment management business is the main investment advisory service, but investment consulting business also plays an important role. At the customer level, the customers of Japanese investment advisory services are shifting from single individual customers to individual customers and corporate customers. In addition to traditional services for individual customers, Japanese investment consultants provide corporate customers with financing and information support in the field of business operations on the one hand, and business succession countermeasures services in the field of succession to corporate customers on the other hand.
(2) Comparison of different charging models of foreign investment advisory services
Foreign investment advisory charging models are diverse, and they emphasize that the interests of investment advisors and clients are consistent. The United States mainly charges based on asset management scale, fixed fees and hourly charges; the charging model in Europe is similar to that in the United States, with more emphasis on charging based on services provided rather than charging commissions; Japan's charging model has also changed from a commission model to a product-centered charging model.
1. United States. There are six main charging models for investment advisory services in the United States: charging based on asset management scale, charging fixed fees, charging by the hour, charging based on performance, commissions and membership fees. Among them, charging based on asset management scale, charging fixed fees or charging by the hour (or both) are the main charging models for investment advisors.
Investment advisory does not charge a single fee, but adopts diversified charging models. In 2021, only 17.4% of investment advisors only charge based on asset management scale, and most investment advisors adopt multiple charging models. The most common thing is that 34.5% of investment advisors charge fixed fees or hourly fees in addition to charging based on asset management scale. The compensation structure of investment advisors aligns their interests with those of their clients. Investment advisors tie their compensation to client investments through asset-based fees and performance fees. In addition to compensation structures, conflicts of interest between investment advisers and clients are also declining.
2. Europe. The charging model adopted by European investment advisors is relatively similar to that in the United States, including charging customers a certain percentage of the asset size, fixed fees, hourly fees, etc. Some countries even require investment advisors to charge based on the services provided instead of charging commissions.
Specifically, the UK requires fees to reflect the services provided by the investment adviser, rather than the specific vendors and products recommended. Under the regulations of the British Financial Conduct Authority, investment advisers in the UK mainly charge service fees. They are not required to collect service fees in a specific form, but they must agree in advance with their clients on how to charge fees and the level of fees, and cannot charge fees through commissions.
3. Japan. With the development of Japan's financial market, Japan's investment advisory charging model has changed from a commission model to a product-centered charging model. Under the product-centered revenue model, Japan has gradually expanded the scope of investment advisory services and derived more service models.
Japan's investment advisory charging models are diverse and give customers more room for choice. In addition to charging based on asset size, they also charge diversified investment advisory fees such as fixed management fees and performance compensation. Taking Nomura Asset Management as an example, Nomura's Independently Managed Account (SMA) charges fixed management fees on a quarterly basis and charges different levels of management fees for different types of assets. Nomura's Wrap account can choose to charge only a fixed management fee on a quarterly basis, or you can choose to charge a "fixed management fee + annual performance compensation" charging form, while charging different levels of management fees for different types of assets.
(3) Reference from foreign investment advisory asset types
Foreign investment advisory assets are rich in types, including stocks, bonds, derivatives, public funds, private funds, innovative financial products, etc. Under each category, there are many subdivided product types to choose from. They also focus on global asset allocation and can achieve diversified and personalized investment portfolio allocation for customers.
1. United States. American investment advisory asset management methods are mainly divided into three categories: independently managed accounts (SMA), parallel managed accounts and comprehensive fee plans. Clients of separately managed accounts include individual investors and institutional investors. In 2021, 73.5% of investment advisors manage SMA assets. In terms of asset allocation, investment consultants will invest in various asset types such as stocks, bonds, derivatives, registered funds, etc. There are also more choices for different asset types. Parallel managed accounts are primarily intended for collective investment vehicles, including investment companies and business development companies. Such accounts pursue substantially the same investment objectives and strategies as the pooled investment vehicles themselves. The comprehensive fee plan is a packaged service through which customers can enjoy various combination services, including brokerage business, securities trading, asset custody, administrative services, etc. Asset growth for comprehensive fee plans has been strong, with growth reaching 17.7% over the three years from 2019 to 2021.
2. Europe. Unlike the U.S. wealth management industry, which is highly dispersed, the Matthew Effect in the European wealth management market is more obvious and the industry is highly concentrated. Wealth management institutions are mainly asset management companies and mixed banking groups. Taking UBS as an example, UBS divides tiers according to customers' net assets and divides categories according to customers' risk preferences for personalized product allocation. In addition to product investments, UBS also leverages its universal banking positioning to provide customers with a wide range of lending and cash management products.
3. Japan. In terms of investment advisory asset allocation, Japanese wrap accounts all invest in trust products, and based on trust products, they invest in global stocks, bonds, real estate and other diversified assets.
(4) References for the development of foreign intelligent investment advisory services
Robo-advisory originated in the United States. The US robo-advisory market currently ranks first in the world, accounting for 70.0% of global robo-advisory assets under management. According to Statista's forecast, the asset management scale of U.S. robo-advisors will be US$1.16 trillion in 2022, and will maintain a compound growth rate of 14.45%. It is expected that the total asset management scale will reach US$1.99 trillion in 2026.
Most robo-advisors use modern investment portfolio theory to build passive index investment portfolios for users. Compared with manually performing this operation at a low cost, robo-advisors help long-tail customers achieve inclusive wealth management. In the robo-advisory market, there are both independent robo-advisors and traditional institutional robo-advisors; there are fully automated robo-advisors that do not require human intervention, and there are human-machine robo-advisors with the participation of human investment advisors. In addition, different robo-advisors have different investment thresholds, fees, investable assets, and whether investment portfolios can be customized.
(5) Comparison of qualification access supervision
Supervision of foreign investment advisory business requires investment advisors to be supervised by regulatory agencies in the region where they are located, and must obtain a license through registration and other means before they can operate.
1. United States. According to the U.S. Investment Advisers Act of 1940, registered investment advisers have a fiduciary duty to their clients, that is, the adviser has the responsibility to provide appropriate investment advice and always act in the best interests of the clients. The United States implements hierarchical supervision of investment advisers by the SEC and state securities agencies.
2. Europe. In order to promote the integrated, healthy and orderly development of the European investment advisory market, the EU has formulated three major regulatory systems: the Transferable Securities Collective Investment Scheme Directive, the Alternative Investment Fund Management Directive, and the European Markets in Financial Instruments Directive to standardize the construction of investment fund products and the development of investment advisory businesses.
3. Japan. Japan's "Financial Instruments Transaction Law" stipulates that investment consultants engaged in asset management services and investment advisory business must apply for registration with the Japanese government and accept specific supervision by the Japan Financial Services Agency.
(6) Comparison of supervision on practice and service content
Supervision emphasizes that investment advisers bear fiduciary responsibilities towards clients, which is the highest standard for investment advisers to make decisions for others. This requires investment advisers to provide services to customers faithfully and prudently, and to act in a manner that maximizes the interests of customers.
1. United States. In terms of practice, the U.S. Investment Advisers Act does not provide a comprehensive regulatory regime for advisers, but rather gives them a broad fiduciary duty to act in the best interests of their clients. In terms of services, the broad fiduciary duty to act in the best interests of clients requires advisors to fulfill obligations to fully disclose material facts, provide appropriate investment advice, have a reasonable basis for recommendations, and guide clients on best execution.
2. Europe. The Collective Investment Schemes in Transferable Securities Directive aims to establish a unified cross-border market for investment funds in Europe, which means that funds approved by EU member states can be sold directly in other member states. The Alternative Investment Fund Management Directive applies to hedge funds, private equity funds, real estate funds and other investment funds not covered by UCITS. The European Markets in Financial Instruments Directive focuses on regulating investment advisory institutions.
3. Japan. Japanese regulations require investment advisers to provide services to clients faithfully and in a prudent management manner. In investment advisory services, Japan attaches great importance to investor protection. The Japan Financial Services Agency issued a customer-centered business code of conduct in 2017.
The development status of investment advisory business in my country
(1) New developments in my country’s investment advisory business
After the issuance of the "Notice", the pilot project of public fund investment advisory business was officially launched, and the buy-side investment advisory model was implemented in China. Compared with the traditional sell-side sales model, the pilot fund investment advisory adopts a buyer-side investment advisory model that makes transaction decisions on behalf of clients. The charging model mainly focuses on collecting investment advisory fees and provides customer-centered full-process accompanying services.
1. Analysis of pilot institutions for investment advisory business in my country. Statistics from the China Securities Regulatory Commission show that from the beginning of the fund investment advisory pilot on October 25, 2019 to July 2022, a total of 60 institutions in my country have obtained the fund investment advisory pilot qualification, including 25 funds and fund subsidiaries, 29 securities companies, 3 third-party sales agencies, and 3 commercial banks. Among the 60 fund investment advisory pilot institutions, 54 have already started operations, involving 4.4 million accounts, 95% of which are small and micro accounts (less than 100,000 yuan), with a management scale of nearly 120 billion yuan.
2. Analysis of my country’s investment advisory development model. Most of the pilot institutions that have launched operations have launched corresponding investment advisory brands and mainly conduct business through online channels. At the channel level, the current pilot institutions are focusing on online business, including providing online fund portfolio solutions and intelligent investment advisory models, which are basically self-service investments without manual intervention in the entire process. The investment advisory service model is a discretionary model. The "Notice" stipulates that pilot institutions engaged in fund investment consulting business can provide services through financial management on behalf of clients. The current pilot institutions in the industry basically provide discretionary managed investment advisory services. At the customer level, we mainly serve individual customers. The investment threshold for the products of each pilot institution is basically in the range of 500 to 1,000 yuan, and the charging model is mainly based on asset management scale (AUM), with most rates ranging from 0.15% to 1.5% per year.
(2) Troubles in the development of investment advisory business in my country
1. Securities companies are troubled by the development of investment consulting business. Customer product investments are concentrated in the stock sector, and the scale effect of fund investment needs to be explored. Most of the customers of securities companies are concentrated in stock trading business. These customers are relatively familiar with exchange-traded funds, but the proportion of funds invested in funds is relatively limited, making it difficult to produce scale effects. How to guide existing customers to switch to the fund field and further promote fund investment consulting business is an urgent problem that securities companies need to solve.
2. The development of investment advisory business of commercial banks is troubled. The investment research capabilities for equity products are weak, and the pilot investment advisory business needs to be expanded. The bank has many years of experience in investment advisory services and has a relatively complete range of product categories. However, the advantages of its own products are mainly concentrated in fixed-income or fixed-income-like financial products. Its strategic research capabilities are relatively weak, and equity product services and investment research capabilities still need to be strengthened. In the investment advisory business pilot, only three banks, namely Industrial and Commercial Bank of China, China Merchants Bank and Ping An Bank, have joined the pilot and none of them have started operations. The investment advisory business development capabilities and the participation of pilot institutions need to be strengthened.
3. Fund companies have trouble developing their investment consulting business. Product sales have long relied on external sales channels, and sales capabilities need to be built. Fund companies' own sales channels used to mainly provide sales services to institutional customers, while product sales to individual customers have long relied on external channels such as commercial banks and securities companies. The current fund investment advisory pilot program focuses on serving individual customers, so it is particularly important for fund companies to build their sales capabilities for individual customers.
Suggestions for the development of investment consulting business in my country
(1) Suggestions on the development of investment advisory business institutions
1. Truly realize "customer-centric" and promote the development of buyer investment advisory. Judging from the development experience of foreign investment consulting, the United States, Europe and even Japan are all adopting the buyer model to provide services to customers. The development of China's investment consulting business still needs to adhere to the "customer-centered" direction, continue to promote the transformation of sell-side investment consulting to buy-side investment consulting, prioritize customer interests, and provide customer service throughout the entire investment process.
2. Give full play to the characteristics and advantages of different institutions and truly implement inclusive finance. Securities companies, commercial banks, fund companies, third-party sales agencies and other institutions need to find their own positioning, match the needs of customers in subdivided fields and their corresponding business models, give consumers more choices in receiving investment advisory services, so that consumers can easily obtain high-quality fund investment advisory services, truly practice inclusive finance, and promote common prosperity.
3. Make full use of financial technology to empower the investment advisory business to reduce costs and increase efficiency. Emerging scientific technologies such as artificial intelligence, cloud computing, and big data have injected new vitality into the investment advisory business, driving the investment advisory business to achieve lower costs and higher efficiency, achieve more accurate customer insights, and provide a more extreme service experience.
(2) Suggestions for regulatory agencies to promote the development of investment advisory business
1. Promote more institutions to participate in the pilot investment advisory business and expand the scope of the pilot investment advisory business. Currently, there are only 60 institutions participating in the investment advisory business pilot. It is recommended that regulatory agencies continue to promote the expansion of the scope of the pilot, normalize the access approval mechanism for investment advisory business pilot institutions, introduce more commercial banks, securities companies and third-party sales agencies, promote the development of banks that have not yet started business, and implement the "sales platform + fund investment advisory" cooperation model.
2. Unify the top-level system design and do a good job in functional supervision to standardize the development of the industry. It is recommended to introduce an "Investment Advisory Law" to place the investment advisory business of various industries and formats under a unified legal framework, implement unified license supervision for the investment advisory business of various financial institutions, and uniformly regulate the development of investment advisory businesses. Further expand the scope of institutional licenses to individual licensed practices, relax restrictions on institutional licenses, and strengthen supervision of practitioners, such as establishing practitioners' disclosure of file information and implementing individual graded licensing and other measures.
3. Gradually expand the asset types and categories of investment advisory products, promote global asset investment, and meet the needs of multiple types of asset allocation. Judging from the experience of foreign investment advisory development, investment advisory assets in the United States, Europe and Japan are very rich in asset types and focus on global asset allocation to increase portfolio returns and further diversify risks. It is recommended that regulatory agencies gradually broaden the asset types and categories of investment advisory products, and include more products other than public funds such as stocks, bonds, bank financing, derivatives, etc. as subjects of the fund investment advisory pilot, and at the same time promote global asset investment to meet residents' multi-category asset allocation needs.
4. Develop diversified service models to achieve consistency in the interests of investment advisors and clients. Regulatory agencies need to learn from foreign investment advisory experience, accelerate the development of investment advisory business, promote investment advisory business institutions to charge various fees such as asset management scale fees and fixed fees, and further reduce the service and management fees of investment advisory through regulatory means, promote the innovation and approval of low-rate products for exclusive investment advisory, and truly solve the problem of consistency of interests between investment advisors and customers.
5. Use regulatory technology, introduce “penetrating” supervision, and promote the application of financial technology in investment advisory institutions. Regulatory agencies still need to strengthen the construction of regulatory technology and improve the efficiency of digital supervision. It is recommended to introduce "penetrating" supervision to truly penetrate the underlying basic assets of products and avoid systemic financial risks. In addition, regulatory agencies must also promote the application of financial technology in investment advisory institutions, further leverage the role of financial technology and digital platforms, and effectively guide investment advisory institutions to provide better consumer services.
(Project leaders: Hu Bin, Li Zhenhua; research team members: Yin Zhentao, Li Xiaojun, Cheng Lian, Bo Chunmin, Zhang Yaogang, Xu Jianjun, Cheng Zhiyun, Ma Dongdong)
The payments industry may be facing its most heavily regulated year yet.
The outsourcing market is under strict rectification, "copying" transactions are classified as illegal, and huge anti-money laundering fines are frequently issued... Some payment institutions on the high-voltage line are conducting self-examination and rectification, some have paid for compliance issues, and some have withdrawn from the market in the process of survival of the fittest.
But despite this, the market chaos is still not over. A recent investigation by a reporter from Beijing Business Daily found that despite repeated strict regulatory crackdowns, many new methods of online sales of POS machines have emerged in the market. In major e-commerce platforms, a variety of POS machines are linked to products. By avoiding sensitive words, they use homophones or related words such as "broken driver", broken driver's card, card consumption machine, personal card reader, scan code payment box, etc. to avoid crackdowns. Judging from the search results, there have been several Hundreds of POS machine products have flowed into the pockets of individual consumers through online sales. Judging from the sales of 200+ and 100+ for a single product, there is still a long way to go to completely rectify this cat-and-mouse game of illegal online sales, and it requires the joint efforts of payment institutions, platforms, supervision and other parties.
Online sales of POS machines are booming
As early as many years ago, supervision had explicitly prohibited online sales of POS machines, and many payment institutions also issued warnings. However, up to now, the chaos of online sales of POS machines has still not been "misfired", and even purchasing on major e-commerce platforms is not difficult.
For example, on the Taobao platform, a reporter from Beijing Business Daily searched for the keyword "POS machine" and it showed "No related products found." However, under the search, related words and products such as "portable card swiping machine", "portable card swiping machine", "small PO machine", "card charging and swiping machine" were listed. If you randomly click on one, the product link of the POS machine is displayed.
In addition, Beijing Business Daily reporters used keywords such as the homophonic word "broken driver", as well as "card swiping machine" and "personal card swiping machine". It can also be seen that different types of POS machines are on sale at multiple payment institutions, with hundreds of product links, and the sales of the top recommended POS machines are as high as 200+ and 100+. According to the sales pages displayed by some merchants, they claim that "it can be processed by individuals or merchants, supports various systems, and can be swiped 1 million times without damaging the card."
A Beijing Business Daily reporter randomly selected a store called "Karaka Central China Service Center" for consultation on the grounds of purchase. The store's customer service told them that they were an agent for Lakara (300773) POS machines and sold the latest all-in-one card swiping and code scanning machines. The card swiping rate was 0.58%, and the QR code scanning rate was 0.38%, and the payment was received in seconds. The machine price is 18 yuan, and a traffic fee of 45 yuan per year is required. According to the customer service representative, when placing an order on Taobao, the after-sales process will be completed by staff adding WeChat.
During the conversation on the Taobao platform, the customer service staff were very cautious in their words and techniques. For example, a space or a slash will be added between the two words "swipe card", or it will be written as "唰"; "add WeChat" will be expressed as "十Vxin"; a comma will also be inserted between the three letters of POS. From the perspective of the industry, similar methods of splitting and changing words may be to avoid triggering the word blocking mechanism of the platform.
And this is not an isolated case. A Beijing Business Daily reporter noticed that another Taobao store called "National Processing Center No. 5 Store" is also selling Lakala's POS machines. The price and rate of the machines are the same as the previous one, but the handling method is more cautious. At the beginning of the consultation, the customer service said that it was inconvenient to answer questions on Taobao, and asked to use WeChat to send product descriptions and usage videos. He also said frankly that "there are some sensitive words that cannot be posted on the Taobao platform, but as long as the sensitive words are not involved, other transactions will be fine."
A reporter from Beijing Business Daily then placed an order for a POS machine at the "National Processing Center Store No. 5". However, when the payment was about to be made, the system displayed "The seller's payment is restricted. Please contact the seller for processing or try again later." Immediately, the customer service provided the reporter with a link to another store. The store name consisted of a string of unordered English letters. The monthly sales volume of the product was small. The reporter successfully completed the order for the product in this store.
In fact, many e-commerce giants currently sell POS machines. In another e-commerce platform that focuses on low prices, similar to Taobao, by searching for "pro machine, credit card, po machine processing, BOS machine", etc., the product introduction will be packaged as a scan code payment box, a home handheld cash register all-in-one machine, etc. In addition, although the product is not directly displayed when searching for POS machines, there will be a series of "search discovery" keyword recommendations on the search page. Once a product is browsed, multiple similar product recommendations will appear on the homepage.
For example, a "Mingguang Digital Technology (300079) Service" store introduced that it is an agent for Jialian payment machines, with a card payment rate of 0.55%, which can be used immediately after registration without any additional fees. The store even said that there are no risks in selling and purchasing POS machines on e-commerce platforms. The purchased POS machines can be used by individuals to swipe their credit cards, raise card balances, and cash out. The store’s POS machine’s “group discount price” is 13.52 yuan.
In addition, on the well-known short video e-commerce platform, a dazzling array of POS machine sales information can also be easily obtained through keywords such as card swiping machines, POS cash registers, and personal card swiping machines. In the product introduction, the word "POS machine" is not even blocked. Many stores attract customers with "regular POS, 0.38 seconds to arrive" and "personal credit card, 2023 new model, no deposit". The prices of the machines range from 0.5 yuan to 70 yuan.
"We have more than 20 offline physical stores and have been in business for seven years." "The main thing we do is after-sales service. I believe you will find it worthwhile as long as you use it." Among them, a store owner who calls himself an agent of Yinsheng POS machines said. According to the business license provided to the Beijing Business Daily reporter, the agent's name is "Zhou Laizhou Electronics Store, Wuhua District, Kunming City" and operates the sales of power electronic components. When asked whether there was a risk of violation when trading on the e-commerce platform, the customer service officer responded, "Strict supervision in terms of policy only applies to credit cards. There is no need to worry about security. The source of each fund can be queried. In fact, how customers use the card is the key. Credit card swiping is about methods. Based on our many years of experience, customers will never be risk-controlled as long as they follow the method."
Organizations respond in unison
In fact, the behavior of selling POS machines on e-commerce platforms has already touched the red line of the industry.
As early as 2016, the central bank issued the "Notice on Matters Concerning Strengthening Payment and Settlement Management to Prevent New Illegal Crimes in Telecom Networks", requiring payment institutions to strictly review the qualifications of special merchants and standardize the management of acceptance terminals. No unit or individual is allowed to buy or sell POS machines (including MPOS), card readers and other acceptance terminals online.
There are also many risks involved in selling POS machines through the Internet. As Su Xiaorui, a senior consultant in the financial industry analyzed by Analysys, said, the online sales of POS machines by e-commerce platforms has lowered the threshold for using POS machines and increased the possibility of illegal use of POS machines. For example, online sales of POS machines have lax requirements for merchant qualifications and low thresholds, and POS machines may be used illegally by illegal elements. Profit; In addition, online sales of POS machines are often accompanied by illegal cash-out, and even involve illegal and criminal activities such as theft and money laundering; in addition, organizations expand sales through "tolerance" of online sales of POS machines, which is also a manifestation of disrupting the order of the industry. For other entities operating in compliance, it can be said that "bad money drives out good money."
In response to the aforementioned online sales issues, reporters from the Beijing Business Daily also conducted interviews with the corresponding payment companies. However, judging from the responses from many institutions, they all stated that they were not aware of the online sales of their products and that violations had been rectified.
Among them, the relevant person in charge of Jialian Payment responded to the Beijing Business Daily reporter that Jialian Pay attached great importance to the sale of POS terminals by the store "Mingguang Digital Technology Service" on the e-commerce platform and immediately contacted the store for verification. According to the store name and business license information published by the store, it was not on the list of outsourcers cooperated by Jialian Payment, and after contacting the store, the latter also failed to provide relevant credentials for cooperation with Jialian Payment.
In response to the store's illegal online sales of POS terminals, Jialian Payment has reported to the e-commerce platform. Currently, the store has removed the POS sales information.
Lakala claimed that the company does not sell POS machines online and has never authorized or allowed in any form outsourcing service agencies to sell POS machines online.
"Our company strictly conducts business in accordance with the red line of prohibiting online sales of POS machines. We regularly send letters to outsourcing service agencies regarding the prohibition of online sales acceptance terminals and market behavior restrictions, clarifying the company's position and emphasizing the consequences of violations. At the same time, we organize all outsourcing service agencies Sign a letter of commitment and promise not to engage in illegal propaganda and other behaviors; arrange for dedicated personnel to supervise and investigate outsourcing service agencies, monitor major e-commerce platforms and Internet advertising platforms, and immediately send a lawyer's letter to them if illegal propaganda is discovered, requiring them to be closed and removed from the shelves," Lakala responded.
The relevant person in charge of Yinsheng Payment stated that the company is not aware of the situation of service providers selling POS machines through the Internet, and strictly prohibits outsourcers from selling POS machines online, and will verify whether the investigation is true as soon as possible and take relevant measures. It was found that "Zhoulaizhouwang Electronic Store, Wuhua District, Kunming City" is a non-company cooperative outsourcing service provider. After querying the acquisition outsourcing service agency registration system of the China Payment and Clearing Association, the outsourcing service provider has not yet completed the registration.
The organization has repeatedly emphasized this, but why are online sales still prohibited? From the perspective of the industry, behind the violations there are still individuals or merchants who take risks for the sake of profit and exploit the loopholes of the institution. At the same time, payment institutions also have management loopholes.
At present, POS machine sellers on the Internet platform are mainly individuals, selling in a marginal way, which is characterized by "one shot and one place". Yu Baicheng, chief researcher of Houxue Research, pointed out that this method will cause difficulties for payment institutions in the management of special merchants. Some individuals may even use the name of the payment institution's brand POS machine, which may actually be counterfeit, which in turn infringes on the interests of the payment institution. However, since online sales of POS machines have been deemed illegal by supervision, online platforms, payment institutions and outsourcers are all responsible for managing illegal online sales.
"The main reason behind this is that there is market space, and at the same time, payment institutions have loopholes in the management of their agents." Wang Pengbo, chief analyst of Broadcom Consulting's financial industry, further said that the corresponding payment institutions must bear management responsibilities and should strengthen risk management and control of merchants recommended by outsourcing institutions through monitoring and inspection and other means. At the same time, outsourcing institutions are not allowed to market POS machines to individuals with no business activities, nor are they allowed to forge merchant application materials or recommend false merchants to the network.
"For acquiring institutions, firstly, they should establish compliance awareness, self-examine and self-correct the existing sales process, and improve internal management; secondly, they should strengthen the management and risk prevention of external agents." Su Xiaorui said.
"The institution is undoubtedly responsible. If you fail to manage the outsourcing service provider, this is a problem." In response to this phenomenon, a supervisor close to the Beijing Business Daily reporter also stated, "The reason why this gray and black industrial chain is so difficult to cure is indeed because of the institutions and even individuals behind it. Everyone has their own interest demands, and as demand arises, new ones are eliminated, so it is difficult to monitor and rectify them in a timely manner. But I believe that by strengthening the rectification of arbitrage and rectifying the root causes, a series of derivative chaos such as online sales will also be eliminated. "
Urgent rectification of the platform
The chaos of online sales of POS machines has returned with a vengeance. According to the industry, the e-commerce platform is also responsible.
As Wang Pengbo pointed out, "Online merchants selling POS machines are mixed, and the quality and service of POS machines are difficult to guarantee, and consumers are easy to fall into traps. Online sales of POS machines have long been banned, and now it has reappeared that agents under payment institutions are committing crimes against the trend, and it also reflects that e-commerce platforms are not strict in auditing."
However, many platforms have also been quick to rectify merchants.
In response to the chaotic online sales, on July 11, Beijing Business Daily reporters also conducted interviews with relevant e-commerce platforms. Taobao responded that according to the "Taobao Platform Prohibited Information Management Rules", the platform prohibits the sale of POS machines and other products or related services that can only be provided by specific financial institutions. The platform controls the above-mentioned behaviors through various means such as technical means and daily inspections. However, the means used by individual merchants to circumvent platform control are increasingly diversified and hidden, such as using variant words, deformed words, etc. to avoid control. According to clues provided by reporters, the platform has controlled relevant products and added relevant search blocking words.
In addition, the person in charge of the above-mentioned short video platform responded to a Beijing Business Daily reporter that the platform banned the sale of POS machines in accordance with the law, and had clear control rules, and would be severely punished if discovered. In response to the situation where some merchants use descriptions such as "card swiping machines" and "consumption machines" to circumvent rules and conduct illegal sales, the platform has upgraded and iterated related technologies and strategies. At the same time, the platform has further improved monitoring coverage and granularity, and strengthened targeted management and control of new violation scenarios such as variant words and variant descriptions.
As of press time, two Taobao stores and a short video platform e-commerce store that Beijing Business Daily reporters consulted have either removed the products from the shelves or displayed "the store does not exist." When searching for "POS machine" or "cash out" again on the above-mentioned short video platform, a prompt will pop up on the page: "Please do not use POS machines for illegal cash out and other activities."
At the same time, the customer service staff of the POS machine where the reporter had previously placed an order on Taobao actively sought to apply for a return, and changed his statement that Lakala products were not sold. When the reporter went to the order page to check, the express delivery showed that it was being returned, the product no longer existed, and the product displayed in the store was replaced by a pair of women's shorts.
According to Article 23 of the E-Commerce Law, the goods sold or services provided by e-commerce operators shall meet the requirements for ensuring personal and property safety and environmental protection requirements, and shall not sell or provide goods or services that are prohibited from trading by laws and administrative regulations. Li Ya, a partner at Beijing Zhongwen Law Firm, told reporters that online sales of POS machines have been banned by regulatory requirements, and platforms should fulfill their obligations as e-commerce platform operators to regulate the market and remove corresponding products from the shelves.
"For social media platforms, they should cooperate with regulatory requirements and adopt certain technical means to screen for online sales of POS machines. For those that are large in number and difficult to identify, a corresponding reporting system can be established." Su Xiaorui further said.
Yu Baicheng also said that online platforms should strengthen the review of illegal products and merchants, and use artificial intelligence technology to identify risks in pictures, texts, transaction records, etc. for borderline sales, so as not to give room for illegal sales; payment institutions and outsourcers should strengthen audit management and risk education. On the other hand, online platforms should be specially monitored, and violations should be reported when violations are discovered, and multiple parties should work together to maintain a reasonable order in the market.
The strictest supervision is coming
Electronic sales and online POS machines, illegal publicity, and lax risk control by merchants have been long-standing chronic problems in the acquiring market.
It is worth mentioning that since the central bank in 2016 required any unit or individual not to buy or sell POS machines, card readers and other acceptance terminals online, the regulatory situation has been tightening. For example, the control over third-party payments is becoming increasingly tight, and the severity of crackdowns on violations of regulations and illegal operations continues to increase. In Wang Pengbo’s view, the industry must develop in a formalized manner in the future, and supervision will become increasingly strict.
This year, payment institutions may also usher in the most stringent regulatory year. The aforementioned source close to the regulator revealed, "Currently, arbitrage transactions have been classified as illegal. Serious violations are crimes, and supervision will severely punish such violations. After the second half of the year, the supervision situation for such behavior will be more stringent, and the entire rectification and governance process will be promoted step by step."
From the perspective of the industry, to restore "clear" space for POS machine sales and completely rectify the chaos of POS machines, network platforms, payment institutions and outsourcing service providers need to make reasonable progress.
As Yu Baicheng pointed out, online platforms must strengthen the review of illegal products and merchants. For "edge-passing" sales behavior, artificial intelligence technology can be used to identify risks in pictures, text, transaction records, etc., and do not give room for illegal sales behavior; payment institutions and outsourcers must strengthen audit management and risk education. On the other hand, online platforms must be specially monitored, and violations must be reported immediately, and multiple parties must work together to maintain a reasonable order in the market.
"Relevant regulations on online sales of POS machines have been revised and improved over the years and are relatively comprehensive in content. Therefore, compared with the content of the system, it is recommended to focus more on the implementation level." Su Xiaorui said that focusing on the implementation of supervision, we must first increase the management of acquiring institutions; secondly, strengthen on-site inspections such as the real-name system for merchants; finally, establish a relevant complaint and reporting system.
Li Ya also said that the follow-up trend should still be stricter supervision, and the significance and value of POS machines should be reorganized to return payment and receipt to its roots. At the same time, compliance rectification should be carried out in conjunction with regulatory policies and self-regulatory standards, the responsibilities of acquiring institutions and outsourcing institutions should be consolidated, rectification work standards should be clarified, and punishments should be intensified for non-compliant institutions. Acquiring market entities that violate regulations and laws should be given due penalties. If acquiring market entities are found to be involved in illegal crimes, they should be transferred to the public security organs in a timely manner.
Beijing Business Daily Financial Investigation Team
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