A Study On The Legal System Of China 's Prepaid Card Supervision

The market economy system has been developing rapidly, with the transaction methods updating all the time. The prepaid transaction settlement is becoming increasingly popular, which results in the prosperity of prepaid card market. In the meantime, however, various chaos have arised from the market, leaving the consumers’ rights unsecured. The regulators have published several rules to supervise the market. Though has been established preliminary, the regulatory system is still not so delicate to supervise the overall prepaid card market effectively and thus need improvement.Prepaid card is a widespread kind of transaction settlement nowadays. Since the consumers can deposit the money into the portable card in advance and the business can recoup operating capital, prepaid cards are well-liked by public. Different from other kinds of cards, prepaid card is prepaid, delivery on request, standard-formed and micro payment method.The prepaid cards could be classified on basis of different criteria. It is a unique legal tool, not ordinary sales contract or loan contract. It is not currency, security or other financial instruments, either. All kinds of chaotic phenomena not only infringe the consumer rights, but also contain risks of money laundry crimes, which may disturb the financial market order. Consequently, regulation on the prepaid cards towards a fair and honest market is more than necessary.The regulatory regimes of different countries regions are so distinctive. USA has several departments to coordinate with each other, sorted the prepaid cards and protect the consumer rights through disclosure and limitation on their liability. Japan has implemented a centralized regulatory regime led by the prime minister, the rules of declaration and registration, succession of status, security deposit and security agreement are also important parts of the system. Quebec in Canada imposes the duty of informing, interpretation and balance refunding to the businesses, and forbids them to charge additional fees. Chinese Taiwan government provides in regulations the items that have to be recorded and items prohibited as well. Besides, it allows several alternative guarantee methods.The Chinese central bank and ministry of commerce have issued several departmental rules to supervise the prepaid card market. The main framework includes: the deposit money custody aimed to prevent misappropriation on clients’ money, real-name purchase so as to prevent offering or accepting bribes, bank transfers aimed to lower the possibility of breaking laws as well as the consumer protection institutions. The overall regime, however, faces great challenges: first, the ownership of deposit money interests is to be determined and availed efficiently; second, the requirement of real-name purchase is often circumvented; third, the online shopping platforms are not in the regulation range; fourth, the non-legal-person enterprises, individual businesses have not been regulated effectively.In sight of these, China should perfect the related institutions on the basis of present regime. To begin with, establish the deposit insurance system with the deposit interests; and then enlarge the scope of mandatory bank transfers; furthermore, put the real-name purchase into practice; moreover, regulate the online shopping platforms discretely; last but not the least,;bring all sorts of issuers into the regulation, limit their issuance right, require them to register and record specified items on the cards issued.