China

Yicai Global | English | News | Jan. 7, 2026 | UndeterminedBudgets-Budgeting

Shandong province in eastern China issued the first batch of local government special-purpose bonds for 2026, totaling CNY72.3 billion (USD10.3 billion). This issuance initiates a nationwide push for infrastructure investment, with 27 provincial-level regions and major cities planning to issue approximately CNY2 trillion (USD286.4 billion) in bonds during the first quarter of 2026. The National People's Congress approves the annual quota for these bonds in March, but since 2019, the State Council has had authority to pre-allocate part of the next year's bond quota to facilitate earlier issuance and support economic growth.

If the historical pre-allocation ratio of around 60 percent is maintained, the pre-allocated bond quota for this year could reach CNY3.1 trillion (USD446.7 billion). This front-loaded fiscal support aligns with government policy to accelerate infrastructure projects early in the year. Shandong's issuance consisted of CNY46.7 billion (USD6.7 billion) in new special-purpose bonds aimed at public welfare projects and CNY25.6 billion (USD3.6 billion) in refinancing bonds used to replace hidden local government debt. This marks the official start of the nationwide issuance of CNY2 trillion (USD286.4 billion) in refinancing bonds for 2026.

Local government special-purpose bonds are categorized as either new bonds, which fund projects with stable returns, or refinancing bonds, which repay maturing debt and swap out hidden liabilities approved by the National People's Congress Standing Committee. In the first quarter of 2025, local governments issued a total of CNY2.8 trillion (USD400.9 billion) in special-purpose bonds, with CNY1.2 trillion (USD171.8 billion) in new bonds and CNY1.6 trillion (USD229.1 billion) in refinancing bonds, according to the Ministry of Finance.

Yicai Global | English | News | Jan. 7, 2026 | Regulation

Following new regulations implemented in April 2025, China’s non-bank payment firms have significantly increased their registered capital and expanded into cross-border markets. The regulations set a minimum paid-in capital requirement of CNY100 million (USD14.3 million) and imposed stricter standards for risk management and capital adequacy. Major players like WeChat’s Tenpay raised capital, with Tenpay’s approval to increase from CNY15.3 billion to CNY22.3 billion (USD3.2 billion). Smaller firms, especially prepaid-card businesses, faced license revocations, resulting in a reduced number of licensed payment providers from which 107 permits were revoked, leaving 164 active in 2025.

The boost in capital aims to enhance institutions’ ability to manage funds and risks and to meet the rising compliance costs related to anti-fraud and anti-money-laundering efforts. The increasing regulatory burden also serves as a foundation for business expansion. Alongside domestic developments, several firms have pushed into the cross-border payments sector, capitalizing on the growth of cross-border e-commerce and higher profit margins. Lakala Payment, LianLian DigiTech, and CoGoLinks saw significant increases in trans-border transaction volumes, with growth rates of 78%, 94%, and 170%, respectively.

Cross-border payment fees, which range from 2% to 3%, are considerably higher than the stable domestic rate of 0.6%, providing higher gross profit margins. These companies also offer value-added services such as multi-currency settlements, exchange rate risk management, and supply chain finance. However, industry experts caution that cross-border payments involve challenges including information asymmetry and multi-market risks, emphasizing the need for strong compliance, risk control, and anti-money-laundering capabilities tailored to each market.

Global Times | English | News | Jan. 7, 2026 | Cyber Attacks and Data Loss

Chinese authorities have issued warnings about a new near-field communication (NFC) scam that enables criminals to remotely steal funds from bank cards and harvest personal data. The scam exploits the misconception that NFC’s short-range technology, which works within about 10 centimeters, is secure. Fraudsters pose as customer service agents, using scenarios like flight cancellation refunds or membership cancellations to gain victims’ trust.

Once trust is established, victims are tricked into downloading malicious apps or allowing remote phone control through screen-sharing. Scammers then instruct victims to enable NFC and hold their bank cards near their phones to skim card details, which are linked to fake payment tools to transfer funds. These scams leverage illegally obtained data and small-amount password-free payments, allowing unauthorized transactions without victims entering passwords.

Victims often lose control over their phones, with malicious apps accessing contacts, messages, locations, and other sensitive permissions. Real-time screen-sharing lets scammers capture verification codes and passwords. The exposure of personal information can lead to reselling of data, targeted scams, fake accounts, money laundering, and long-term damage to credit and digital security.

Authorities advised the public not to trust unsolicited calls about refunds or compensation, avoid clicking unknown links or downloading apps, and refrain from enabling screen-sharing. They also recommended turning off NFC when not in use and disabling password-free small transactions to reduce risk.