Core Viewpoint - The acquisition of the payment license by Xiaohongshu through its subsidiary Ningzhi Information marks a significant step in enhancing its commercial ecosystem and reducing reliance on external payment channels [5][6]. Group 1: Company Changes - Dongfang Electronic Payment Co., Ltd. has undergone a complete shareholder exit, now fully controlled by Ningzhi Information, a subsidiary of Xiaohongshu Technology Co., Ltd. [1] - The payment license held by Dongfang Payment is valid until May 2, 2026, and has been renewed for operations including internet payment [4]. - The registered capital of Dongfang Payment increased from 12,130 million to 20,000 million, reflecting a capital injection of 7,870 million [4]. Group 2: Financial Performance - Dongfang Payment reported revenues of 8.88 million in 2024 with a net loss of 8 million, and for the first half of 2025, revenues were 3.76 million with a net loss of 5.27 million [6]. - The total assets of Dongfang Payment are reported at 132 million, with owner equity at 93 million, indicating financial struggles leading to the sale of shares [6]. Group 3: Market Implications - The acquisition of the payment license is seen as a strategic move to fill a critical financial infrastructure gap for Xiaohongshu, enabling better control over transaction costs and user data [5][6]. - Xiaohongshu is expected to integrate the payment license into its local life services, enhancing transaction efficiency and merchant experience through various scenarios like community e-commerce and automatic commission distribution [7]. - While Xiaohongshu's entry into the payment space may not disrupt the dominance of Alipay and WeChat Pay, it will intensify competition among vertical platforms for niche payment scenarios [7].