THE central bank has shut down a payments firm specializing in prepaid cards for misusing customers’ money, forging documents and operating beyond its scope, the People’s Bank of China (PBOC) said in a posting on its website Friday.

    The PBOC said it has revoked the license of Zhejiang Yi Shi Enterprise Management Services Co. Ltd. after discovering the fraudulent activity.

    The incident exposes the risks inherent in opening up payment services to non-bank institutions as China liberalizes its financial system and could lead authorities to tighten regulations.

    Some cards were unusable as a result of misappropriated funds at Yi Shi, which had held a payment business license since 2011, the PBOC said.

    The central bank directed the company to raise funds to ensure that cards could still be used and said customers and business partners could resolve any losses through the court system.

    (SD-Agencies)