Expected annualized return of up to 2.5%! FSC once warned, "Street Payment" TrustBao officially launched

The leading payment app in Taiwan, JKos Pay, officially launched the long-controversial fund product "Tuofubao" on the 20th. According to JKos Pay's announcement, users can earn daily interest on their deposited funds, which can be withdrawn at any time, with an expected growth rate ranging from 1.2% to 2.5%. This product has been widely promoted since the beginning of the year but was delayed due to a serious warning from the Financial Supervisory Commission (FSC) and was only recently launched.

What were the reasons for the initial blockage? Why is it now moving forward?

Former FSC Chairman Gu Lixiong once said: "We encourage innovation, but cannot accept fund-raising."

According to a report by Business Today, when the news of "Trust Treasure" was released in January this year, it was pointed out that the claim of a guaranteed annual return of 1.5% in the advertisement might violate the norms of financial investment products that "cannot guarantee returns." The FSC Securities and Futures Bureau also warned that Street Pay must operate in compliance with the relevant regulations of the Investment Trust Act.

Earlier this year, former FSC Chairman Gu Lixiong said that they encourage innovation, but cannot accept fund-raising. The reason is that he believes that if funds are sold and returns are guaranteed for any reason, paying the difference to fund investors, regardless of the model used, constitutes a guaranteed return, which is suspicious of absorbing deposits under the Banking Act.

Street Pay CEO Hu Yixin subsequently stated that they would cancel the guaranteed return of "Trust Treasure" and adjust related content.

Going forward? Street Pay: Introduced in compliance with supervision

According to an interpretation letter from the FSC in December last year, electronic payment accounts like Street Pay have been expanded to allow the purchase of new Taiwan dollar-denominated funds issued by investment trust companies, and to make fund purchases via electronic payments.

According to a report by Cnyes, electronic payment operators need to meet two requirements. Electronic payment institutions need to agree with users on automatic subscription targets and limits, and have mechanisms to stop automatic subscriptions and adjust limits at any time.

Additionally, there is a requirement for electronic payment institutions to have a dedicated deposit account to handle investors' payment instructions and fund transfers. CEO Hu Yixin also promised to establish a dedicated custody account with an initial investment of 200 million yuan to safeguard returns.

However, according to a report by CNA, officials from the FSC Securities and Futures Bureau responded early this month that "Trust Treasure" is not part of the financial system, but Street Trust and Street Pay are under the jurisdiction of the FSC. Therefore, the investment trust contracts and cooperative merchants established by Street Trust must comply with regulations, and direct or indirect guaranteed returns are not compliant.

After the launch of "Trust Treasure" on the 20th, according to Business Next, in a conversation between Street Pay and FSC Chairman Huang Tianmu, CEO Hu Yijia fully felt the determination of the FSC to actively promote the development of financial technology. Only after ensuring compliance with financial regulations and fully protecting consumers' rights, would the Trust Treasure service be announced.

According to a report by UDN, the Securities and Futures Bureau stated today that Street Trust Treasure's structure has not been approved. They will immediately ask Street to explain and confirm if it involves any illegal activities, and urge investors to be cautious about their rights until the competent authority clarifies the situation.

Cryptocurrency profit products, any opportunities?

Compared to cryptocurrency fixed/floating income products not subject to banking regulations, although there are currently no concerns about fund-raising due to the definition of cryptocurrency as a commodity in Taiwan, and the annualized interest rates are higher. However, there are still certain thresholds for the general public in terms of basic knowledge and operations, coupled with rampant fraud. It may still require clear regulations from regulatory agencies to gain public acceptance.

With "Trust Treasure" successfully passing this time, perhaps in the future there may also be opportunities to combine cryptocurrency investment targets, serving as another gateway for public adoption.

Compared to China: Alipay Ant Group to return to Hong Kong and Shanghai for listing

Ant Group, which owns products like Alipay and Yu'e Bao, officially announced on the 20th that it will seek listings on the Shanghai Stock Exchange's Sci-Tech Innovation Board and the main board of the Hong Kong Stock Exchange.