A man walks past the headquarters of the People's Bank of China (PBOC), in Beijing. Photo: Reuters/Jason Lee

The People’s Bank of China has relaxed restrictions on foreign companies invested in third-party payment methods in its No.7 announcement released on Wednesday, The Paper reported.

Achieving a unified access standard and regulatory requirements for both domestic and foreign firms to invest in payment methods will help foster innovation-driven competitive advantages and further optimize the industrial structure, said a PBOC insider.

So far, foreign payment institutions in China, represented by Paypal, are only allowed to support cross-border transactions. While Alipay and WeChat Pay, the two digital wallets developed by Alibaba and Tencent respectively, have dominated the domestic market.

To apply for the license, foreign institutions must set up a foreign-invested enterprise in China as the main body for the application. Also, they should have a business and recovery system that is safe and standardized.

Foreign-invested payment institutions must abide by the laws of China, and personal information as well as financial information collected and generated in China, shall be stored in China.

Other requirements for applicants require payment institutions to have recorded profits for over two years.