China's Banking Sector Wild Card Into Single Business Risk Control Research

In recent years, with China’s accession to the World Trade Organization, domestic financial market is gradually opening up. Foreign banks card industry is gradually entering the Chinese market, followed up with the flourish development of China’s foreign card acquiring market. Faced with the fierce competition caused by international card acquiring banks and institutions" entering to China, domestic banks still dare not to step forward in foreign card acquiring business. One important point is that potential risks in foreign card acquiring business still can not be handled correctly yet. Based on the above problem, this article, through studying domestic banks foreign card acquiring market, is going to figure out how to control certain risk in foreign card acquiring business and improve merchant quality, which has significant practical meaning on the healthy development of China’s foreign card acquiring business.Firstly, the article starts from bank card industry study home and abroad. Then, the article makes comparative study of domestic and international card acquiring markets, as well as the development of some major international card acquiring organizations. By analyzing comparatively strengths and weaknesses, the article points out the necessity of developing card acquiring business in domestic banks.Second, the article makes detail study of risks related with foreign card acquiring business, and from the perspective of economic theory, analyzes the generation mechanism of card acquiring risks, and describes some characters and species of such risks. Then, the article carries out empirical research on calculation methods on chargeback risk in foreign card acquiring business, and conducts compared static analysis based on false card data of international card organizations. Besides, the article makes detailed description on the chargeback risk of foreign card acquiring business, through specific practical cases.Finally, the article summarizes three key measures on risk prevention of foreign card acquiring business. Furthermore, it analyzes the current DCC model in international card acquiring market as well as EMV tech, and explains their potential risk control effects on domestic card acquiring market so as to provide necessary support on domestic banks card acquiring industry.