There appears to be no let up in Macau’s anti-corruption crackdown on the gambling industry as Macau authorities recently announced that they were going to keep a close watch on all AliPay operations.
Alibaba Group, the biggest e-commerce retailer in the world owns AliPay, a company which facilities payments throughout China. Back in July 2015, AliPay reached an agreement with Macau Pass to expand its services into Macau and is now in the process of aggressively expanding in Macau.
Macau authorities want to be sure that a strong process is in place at all AliPay facilities to ensure that all financial transactions are legal and that the payment system is not manipulated by criminals to facilitate money laundering. AliPay is currently targeting Macau’s casinos as it believes it is an extremely profitable market but also one that Macau’s government is closely watching as the casino industry is one of the biggest targets for money launderers.
Lionel Leong, the Secretary for Economy and Finance has asked his team to carefully monitor all AliPay transactions and to report any suspicious activity. However a number of gaming analysts including Union Gaming stated that casinos will not be very keen to tie up with this third party payment service.
AliPay is currently being used in over 100 stores in Macau who have signed up to accept third party transactions that have a ceiling of 5,000 yuan per transaction and a maximum of 50,000 yuan per month. Leong stated that although the government had concerns that the service could be manipulated by criminals, such a service was essential in developing e-commerce within Macau and also to boost the overall economy.
China’s UnionPay which runs a similar service using “point of service” (POS) transaction devices has a much larger network that AliPay and announced earlier this month that it was going to tighten its policies to ensure that there was no room for criminals to manipulate its system. The new policy that the company has rolled out requires users to register their mobile number before they can initiate a UnionPay transaction. The vendors who use these POS devices are also required to register themselves and get a validation permit from UnionPay to continue to use these devices.
The decision to tighten regulations on companies like AliPay and UnionPay has gone down well with the majority of vendors. In a statement, a gaming analyst who preferred to be anonymous said “This is clearly a key step towards ensuring a better regulated environment for Macau’s gaming industry. These abuses have been going on for way too long and have to stop.”