IPO Observation: Suspicions Surround Compliance and Competitive Advantage, Sishun Software Faces Second Round of Inquiry: Four-Fifths of Main Payment Technology Service Clients Lack Qualifications, Multiple Clients Have Been Punished by Regulators

Recently, Shenzhen-based Sishun Software Co., Ltd. (hereinafter referred to as "Sishun") received a second round of inquiry from the Northbound Stock Exchange (NBE) for its initial public offering (IPO) application, with a focus on five major issues: compliance, competitive advantage, and the impact of the parent company's continuous losses.

Compliance Issues

The payment technology service revenue accounts for 70%

Four-fifths of main clients lack qualifications, multiple clients have been punished by regulators

According to the NBE's second round of inquiry, the issue of compliance remains a major concern. Among Sishun's 13 main payment technology service clients, five do not possess the necessary qualifications for operating payment services. As of now, Sishun still maintains cooperative relationships with some of these unqualified clients.

In the first round of inquiry, Sishun replied that it had received income from these unqualified clients. Among them, Beijing Tianzhao Technologies Co., Ltd. and Shenzhen Hushi Technology Co., Ltd. have been punished by regulators for violating payment rules.

Sishun has also been punished by regulators for violating payment rules. For instance, Shanghai Fuyou Payment Services Co., Ltd. was fined CNY 430,000 for violating payment regulations.

Sishun's main clients include payment institutions that possess certain qualifications and good reputations. However, some of these clients have been punished by regulators for violating payment rules.

Sishun's response to the first round of inquiry states that some of its clients overlap with those of its parent company, but these clients only account for a small percentage of Sishun's total revenue.