A Face Scan Paid RMB 15,000. It Also Signed for a Loan.

One face scan, two things

In August 2026, someone in China scanned a QR code at a shop and paid RMB 15,000.

According to a September 16 report by Guo Congcong of 21st Century Business Herald, this customer brushed against an installment option belonging to a credit product inside the payment menu, and the installment plan was then opened during the face-recognition step. Interest and fees came to RMB 120.89.

In the customer’s own words: “The app gave me no indication at all that I had opened an installment plan, and I had no knowledge whatsoever of the interest and fees. I thought it was just an ordinary charge.”

That detail is worth pausing on.

In that flow, the face scan did two jobs. One was to confirm I am the person paying. The other was to confirm I am the person borrowing.

Two things, one face, one confirmation.

The same report carries two more scenes. At a car park exit in Wuhan, the payment page was covered in lending pop-ups, and one carried a fake close button — tapping it opened a loan page. In Beijing, a man surnamed Zhang scanned a code at an e-bike charging station and paid RMB 5; a pop-up asked him to authorize quick payment on a bank card through a third-party platform. Days later he got texts showing an insurer had taken four payments of close to RMB 300 each.

A RMB 5 charging fee and four charges of nearly RMB 300 each, with the same gesture in between: on a payment page, tapping continue.

That column used to answer one question

The list of options at an online checkout used to answer a single question: what are you paying with. Balance, debit card, credit card.

Then a second kind of option began appearing in the same column — one that answers who are you borrowing from.

Names like “monthly pay” and “installment pay” do not contain the word “loan.” Under the Measures, they are loan products.

On April 21, 2026, eight bodies — the People’s Bank of China, the Ministry of Industry and Information Technology, the State Administration for Market Regulation, the National Financial Regulatory Administration, the China Securities Regulatory Commission, the China National Intellectual Property Administration, the Cyberspace Administration of China and the State Administration of Foreign Exchange — issued the Measures for the Administration of Online Marketing of Financial Products as Announcement [2026] No. 9. They take effect on September 30, 2026.

Article 12 puts the whole thing down to where something sits on a page:

“Non-bank payment institutions shall not include loans, asset management products or other financial products among payment tool options, and shall not provide marketing services for loans, asset management products or other financial products.”

Note the scope of Article 12: non-bank payment institutions. A bank’s own app is not bound by that article, but the Measures as a whole do apply to banks — Article 11 requires that where several categories of financial product are marketed together, each category gets its own display area.

As Tian Lihui, a professor of finance at Nankai University, sees it, the change removes at the root a platform’s ability to use a user’s payment habit to blur the line between spending your own money and spending borrowed money, and keeps users from opening credit lines or buying investment products unknowingly or by mistake.

One thing that got garbled in the retelling is worth correcting here: the rule does not ban these products from being used to pay. It requires them to be displayed separately from basic payment tools such as bank cards and account balances. “Monthly pay is being removed from checkout” was a misreading.

Payment habit. That is the hinge of the whole story. The time you spend at a checkout is measured in seconds.

”11 fen a day” and “7.2% a year” describe the same money

One advertising line copied down in the same report: “Total annualized cost (simple interest) from 7.2%; borrow RMB 1,000 for 12 months for only RMB 0.11 a day.”

Under the most common reading — equal monthly installments at a 0.6% monthly rate — both numbers check out.

Here is the arithmetic. What follows is my own worked example using the standard equal-installment formula — it is not any platform’s actual quote. Take RMB 1,000, 12 installments, equal monthly payments, a simple annualized rate of 7.2%, which corresponds to a monthly rate of 0.6%. The monthly payment is RMB 86.62. Over 12 months you repay RMB 1,039.44. The interest is RMB 39.44. Divide RMB 39.44 by 365 days and you get RMB 0.108 — rounded, RMB 0.11 a day.

Now run it backwards. RMB 0.11 times 365 is RMB 40.15. Divide that by RMB 1,000 and you get 4.0%.

The real annualized figure is 7.2%. That is 1.79 times the number you just worked out in your head.

Where does the gap come from? The principal is repaid month by month. Working the RMB 39.44 of interest back at 7.2% gives RMB 547.8 — that is what you effectively borrowed for a full year, not RMB 1,000. You feel like you borrowed RMB 1,000 for a year. On average you had a little over half of it.

Put “per day” in front, and the number the reader computes is the one they have already halved for themselves.

Article 10 of the Measures sets out a prohibited list. It bars “false or misleading content”; for installment products, it bars “inducing consumption through one-sided promotion of first-period fee discounts”; and it bars inducement wording such as “low risk,” “low threshold,” “instant credit,” “high return,” “low interest rate” and “no cost.”

Neither number in that advertising line is wrong. But two days ago — on September 18 — five industry bodies (the National Internet Finance Association of China, the China Banking Association, the China Trustee Association, the China Association of Finance Companies and the China Microfinance Association) jointly issued a Self-Regulatory Code on the Explicit Disclosure of Total Financing Cost in Personal Lending, effective from the date of issue.

One of its provisions: when disclosing total financing cost, all interest and fees a borrower bears under normal repayment must be converted item by item to an annualized figure using the internal rate of return method, following People’s Bank of China Announcement [2021] No. 3 — and “daily interest rate,” “monthly fee rate” and similar forms may not be used in place of the annualized total financing cost.

Online applications must also show a standard-format disclosure table in a dedicated pop-up, with a forced reading time of no less than 10 seconds.

So “only RMB 0.11 a day” stopped being a grey area on September 18.

Worth noting in passing: the conversion method that code prescribes — internal rate of return — is exactly the one the worked example above uses.

The number the industry built an altar to: one step fewer

On January 19 this year, People’s Daily ran a piece on pay-later services by reporters Wu Shaomin, Zhao Zhanhui and Ge Mengchao. It quotes a merchant: a trouser manufacturer in Shenzhen said that after adding a pay-later option, sales rose by more than 30%. A Taobao skincare seller said order volume rose noticeably, because livestream pre-sale cycles run long.

Mark the boundary of that number first. It measures the difference between having the feature and not having it — not the difference between it sitting first in the list and sitting somewhere else. That second question gets its first readable data after September 30.

Wang Pengbo, a senior analyst in the financial industry at Broadtong Consulting, described the commercial logic of payment screens in the 21st Century Business Herald report quoted earlier: payment is a high-frequency entry point where user attention is relaxed, the conversion rate on a single tap is far higher than on an active search, and what a platform earns from monetizing financial products there far exceeds the payment fee — “so inducement design has become the standard path for monetizing traffic.”

Figures like these are usually cited to show one thing: there is real demand for the feature.

That reading may well be right. But it skips a question — which comes first, the demand or the position?

A May 19 report in China Youth Daily, by Liu Pai and Wei Wan, put it this way: “When you are in a hurry to finish paying and habitually tap the option that has been preselected, pushed at you in a pop-up or placed up front, you may not notice that it is not a bank card or a balance, but a ‘monthly pay’ credit product.”

And on April 28, Zeng Gang, director of the Shanghai Institution for Finance and Development, made a prediction to China Securities Journal: “Once payment and credit are forced into separate displays, loan products have to move into their own section, users have to reach for them deliberately, and conversion will inevitably fall sharply.”

There is an admission buried in that prediction. If conversion really came only from demand, moving a product into a section people have to open deliberately should not make conversion fall sharply.

That is an inference, and I cannot prove it. What I can say is that the September 30 rebuild turns the question into an experiment with a readable result — and the industry’s own expectation of a decline has already offered one answer.

Some sense of scale. The China Banking Association’s Report on the Development of China’s Consumer Finance Companies (2026), released July 29, says the country’s 31 licensed consumer finance companies issued RMB 5.24 trillion in personal consumer loans during 2025, served 581 million customer instances, and ended 2025 with RMB 1.43 trillion in loans outstanding.

Spread 581 million across the 31,536,000 seconds in a year and you get 18 a second — customer instances served, not loans booked, but enough to show the density of the thing.

And that covers only those 31 licensed companies — not credit cards, not banks’ own lending, not internet microlenders. The People’s Daily piece adds a separate measure: an international market research firm, which the paper does not name, estimated China’s pay-later lending market at close to RMB 1 trillion in 2025 — market size, not balances outstanding.

What the checkout looks like after September 30

Liu Sihong, a reporter at Beijing Business Today, ran a hands-on check on September 17 (carried by 21jingji.com).

WeChat Pay’s checkout is now split into five blocks — “Wealth,” “Bank cards,” “Digital RMB,” “Credit” and “Other.” Savings cards and the digital RMB wallet sit at the top; Fenfu is filed on its own under “Credit” at the bottom, fully separated from ordinary payment options.

Alipay has separated bank card payment, payment tools, credit and installments; Huabei and Huabei installments are filed under their own “Credit” and “Installment” sections.

Meituan’s checkout is split into “Meituan Pay,” “Financial services” and “Other payment methods,” with savings and credit cards under Meituan Pay and Meituan Monthly Pay under “Financial services.” Vipshop splits its page into “Vip Pay,” “Credit” and “Other payment methods.”

The same reporter noted that some e-commerce platforms have been slower to rebuild, still showing credit products alongside bank cards and balances without full physical separation. None were named.

Three things need saying plainly.

First, nothing has been withdrawn. Monthly pay is still there. Huabei is still there. What changed is which box they stand in. Alipay told the press that Huabei and Yu’ebao can still be used to pay in Alipay and that its checkout page has been separated as the new rules require; Meituan said it is providing Meituan Monthly Pay as normal and will comply with national regulations.

Second, the rebuild ran ahead of the deadline. That May 19 China Youth Daily report already noted that as of filing, many platforms including Meituan, Trip.com and Tmall had completed credit separation on their payment pages, some labelling the section “Financial services” — more than four months before September 30. Tian Lihui’s assessment: “Leading platforms have been the first to complete the checkout separation rebuild. This is active, early implementation of what the regulator asked for, and the overall direction fully matches the thrust of the rules.”

Third, the Measures take effect on September 30. The platforms named above are the ones hands-on reporting found had already finished separating their pages.

In your own ledger, this is two lines

A payment and a debt have never been the same thing.

A payment means your money is gone. A debt means your money is still there but will go later, and the time in between has a price. That RMB 120.89 is the price.

If a checkout puts those two things in the same column, your ledger will probably record them on the same line: one RMB 15,000 expense, done. Then next month you record the repayment, and the numbers stop matching.

This is why expense trackers keep credit-card accounts as negative balances, apart from savings accounts. Not for looks — because the two kinds of money are not the same kind of money arithmetically.

(Disclosure: I build Cenno, a personal ledger app, and it splits them the same way — a credit card is a liability account, its balance is recorded as negative, and at reconciliation it is a separate line from a debit card.)

After September 30 you will still scan your face.

But under Article 12, paying and borrowing have to be asked of you separately, twice.

Being asked twice does not guarantee you will think it over a second time. It only guarantees you get the chance to.