China's five largest commercial lenders started providing interbank transfers and transfers within accounts of a bank via mobile banking for free on Thursday, as part of their efforts to deal with increasing competition from Internet finance companies.
These banks will soon provide similar transfers not exceeding 5,000 yuan ($766) via Internet banking for free.
They signed an agreement on Thursday to tighten up the management of personal bank accounts and improve relevant banking services. The banks will have differentiated management approaches for personal bank accounts that will be classified into three categories.
For instance, a personal bank account that is opened via electronic channels such as mobile and Internet banking, with the bank taking necessary measures to crosscheck the client's identity, can be used for purchases and payments not exceeding a total of 10,000 yuan per day, apart from making investments on wealth management products. Otherwise, it could only be used for small purchases and payments with the account balance capped at 1,000 yuan.
Xu Luode, vice president at Bank of China Ltd, said, "The classification and differentiated management of personal bank accounts have a distinct feature of Internet finance, showing that the Chinese banking sector is taking a major step forward in developing Internet-based financial services."