The Payment & Clearing Association of China (PCAC), which is formed by a group of payment institutions and banks, recently issued a set of self-regulation codes for card acquirers' outsourcing business, in a bid to better regulate the industry.
According to the codes, member card acquirers will need to perform due diligence reviews on outsourcers, and are not allowed to outsource core function, such as signing contracts with merchants and settling funds, to third parties. Card acquirers, also known as merchant acquirers or acquiring banks, are financial institutions that provide merchants with a merchant account and process transactions and settle funds on behalf of merchants.
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