UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549 

____________

FORM 10-Q

FORM 10-Q

____________

 X  .QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended February 28,May 31, 2010

      .TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from ______ to _______

Commission File Number 000-53537

SINO PAYMENTS, INC.

(Name ofsmall business issuer in its charter)

Unit T25, GF Bangkok Bank Building

18 Bonham Strand West

 Sheung Wan, Hong Kong

(Address of principal executive offices)

1-631-458-1377+852-8121-4220

(Registrant’s telephone number)

with a copy to:

Carrillo Huettel, LLP

3033 Fifth Ave. Suite 201

San Diego, CA 92103

Telephone (619) 399-3090

Facsimile (619) 399-0120

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

  X  .Yes          . No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.10-K .       .Yes     X  . No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).       .Yes  X  . No

As of February 28,August 3, 2010, there were ­­­­­­­­53,310,821 shares of the registrant’s $.00001 par value common stock issued and outstanding.

1SINO PAYMENTS, INC.*

TABLE OF CONTENTS

*Please note that throughout this Quarterly Report, except as otherwise indicated by the context, references in this report to “Company”, “SNPY”, “we”, “us” and “our” are references to Sino Payments, Inc. All references to “USD” or United States Dollars refer to the legal currency of the United States of America.

21

2

PART I: FINANCIAL INFORMATION

ITEM1. FINANCIAL STATEMENTS

SINO PAYMENTS, INC.

(formerly China Soaring, Inc.)

(A Development Stage Company)

Financial Statements

(unaudited)

February 28,May 31, 2010

3

SINO PAYMENTS, INC.

(formerly China Soaring, Inc.)

(A Development Stage Company)

Balance Sheets

(unaudited)

(The accompanying notes are an integral part of these financial statements)

4

SINO PAYMENTS, INC.

(formerly China Soaring, Inc.)

(A Development Stage Company)

Statements of Expenses

(unaudited)

(The accompanying notes are an integral part of these financial statements)

5

SINO PAYMENTS, INC.

(formerly China Soaring, Inc.)

(A Development Stage Company)

Statements of Cash Flows

(unaudited)

(The accompanying notes are an integral part of these financial statements)

6

SINO PAYMENTS, INC.

(formerly China Soaring, Inc.)

(A Development Stage Company)

Notes to the Financial Statements

February 28,May 31, 2010

(unaudited)

1.

Nature of Operations and Continuance of Business

Sino Payments Inc. (the “Company”) was incorporated in the State of Nevada on June 26, 2007. The Company is a Development Stage Company, as defined by Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 915,Development Stage Entities. The Company’s principal business is to provide credit and debit card processing services to multinational retailers in Asia.

Going Concern

These financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The Company has not generated significant revenues since inception and is unlikely to generate significant revenue or earnings in the immediate or foreseeable future. The continuation of the Company as a going concern is dependent upon the continued financial support from its shareholders, the ability of the Company to obtain necessary equity financing to continue operations, and the attainment of profitable operations. As at February 28,May 31, 2010, the Company has not generated revenues, has a working capital deficiency of $101,350$157,957 and has accumulated losses totaling $818,849$875,456 since inception. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These financial statements do not include any adjustments to the re coverabilityrecover ability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

2.

Summary of Significant Accounting Policies

a)

Basis of Presentation

These financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in U.S. dollars. The Company’s fiscal year end is August 31.

b)

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to the deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from t he Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

c)

Interim Financial Statements

These interim unaudited financial statements have been prepared on the same basis as the annual financial statements and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company’s financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period.

7

SINO PAYMENTS, INC.

(formerly China Soaring, Inc.)

(A Development Stage Company)

Notes to the Financial Statements

February 28,May 31, 2010

(unaudited)

2.

Summary of Significant Accounting Policies (continued)

d)

Cash and Cash Equivalents

The Company considers all highly liquid instruments with maturity of three months or less at the time of issuance to be cash equivalents.

e)

Financial Instruments

Pursuant to ASC 820,Fair Value Measurements and Disclosuresand ASC 825,Financial Instruments, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 and 825 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 and 825 prioritizes the inputs into three levels that may be used to measure fair value:

Level 1

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

The Company’s financial instruments consist principally of cash, and amounts due to related parties.  Pursuant to ASC 820 and 825, the fair value of our cash is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets. We believe that the recorded values of all of our other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.

f)

Loss Per Share

The Company computes net loss per share in accordance with ASC 260,Earnings per Share. ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing net loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti dilutive.

8

SINO PAYMENTS, INC.

(formerly China Soaring, Inc.)

(A Development Stage Company)

Notes to the Financial Statements

February 28,May 31, 2010

(unaudited)

2.

Summary of Significant Accounting Policies (continued)

g)

Comprehensive Loss

ASC 220,Comprehensive Income, establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at February 28,May 31, 2010, the Company has no items that represent a comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the financial statements.

h)

Foreign Currency Translation

Transactions in foreign currencies are translated into the currency of measurement at the exchange rates in effect on the transaction date. Monetary balance sheet items expressed in foreign currencies are translated into United States dollars at the exchange rates in effect at the balance sheet date. The resulting exchange gains and losses are recognized in income.  Foreign currency transactions are primarily undertaken in Hong Kong dollars.  

i)

Stock-based Compensation

The Company records stock-based compensation in accordance with ASC 718,Compensation – Stock Compensation using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. Equity instruments issued to employees and the cost of the services received as consideration are measured and recognized based on the fair value of the equity instruments issued.

j)

Recent Accounting Pronouncements

In August 2009, FASB issued an amendment to the accounting standards related to the measurement of liabilities that are recognized or disclosed at fair value on a recurring basis. This standard clarifies how a company should measure the fair value of liabilities and that restrictions preventing the transfer of a liability should not be considered as a factor in the measurement of liabilities within the scope of this standard. This standard is effective for the Company on October 1, 2009. The adoption of this amendment did not have a material effect on the Company’s consolidated financial statements.

In October 2009, FASB issued an amendment to the accounting standards related to the accounting for revenue in arrangements with multiple deliverables including how the arrangement consideration is allocated among delivered and undelivered items of the arrangement. Among the amendments, this standard eliminated the use of the residual method for allocating arrangement considerations and requires an entity to allocate the overall consideration to each deliverable based on an estimated selling price of each individual deliverable in the arrangement in the absence of having vendor-specific objective evidence or other third party evidence of fair value of the undelivered items. This standard also provides further guidance on how to determine a separate unit of accounting in a multiple-deliverable revenue arrangement and expands the disclosure requirements about the judgments made in applying the estimated selling price method and how those judgments affect t he timing or amount of revenue recognition. This standard, for which the Company is currently assessing the impact, will become effective on January 1, 2011.

9

SINO PAYMENTS, INC.

(formerly China Soaring, Inc.)

(A Development Stage Company)

Notes to the Financial Statements

February 28,May 31, 2010

(unaudited)

2.

Summary of Significant Accounting Policies (continued)

j)

Recent Accounting Pronouncements

In October 2009, the FASB issued an amendment to the accounting standards related to certain revenue arrangements that include software elements. This standard clarifies the existing accounting guidance such that tangible products that contain both software and non-software components that function together to deliver the product’s essential functionality, shall be excluded from the scope of the software revenue recognition accounting standards. Accordingly, sales of these products may fall within the scope of other revenue recognition standards or may now be within the scope of this standard and may require an allocation of the arrangement consideration for each element of the arrangement. This standard, for which the Company is currently assessing the impact, will become effective on January 1, 2011.

In January 2010, the FASB issued an amendment to ASC 505, Equity, where entities that declare dividends to shareholders that may be paid in cash or shares at the election of the shareholders are considered to be a share issuance that is reflected prospectively in EPS, and is not accounted for as a stock dividend.  This standard is effective for interim and annual periods ending on or after December 15, 2009 and is to be applied on a retrospective basis.  The adoption of this standard is not expected to have a significant impact on the Company’s consolidated financial statements.  

In January 2010, the FASB issued an amendment to ASC 820, Fair Value Measurements and Disclosure, to require reporting entities to separately disclose the amounts and business rationale for significant transfers in and out of Level 1 and Level 2 fair value measurements and separately present information regarding purchase, sale, issuance, and settlement of Level 3 fair value measures on a gross basis.  This standard, for which the Company is currently assessing the impact, is effective for interim and annual reporting periods beginning after December 15, 2009 with the exception of disclosures regarding the purchase, sale, issuance, and settlement of Level 3 fair value measures which are effective for fiscal years beginning after December 15, 2010.  

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its consolidated financial statements.

3.

Notes Payable

a)

In July 2009, the Company issued $7,200 of convertible promissory notes to a third-party company for services rendered.  Under the terms of the note agreement, the amount is unsecured, non-interest bearing, due on demand, and convertible into common shares of the Company at $0.04 per common share at the discretion of the note holder commencing from the issuance date.  In accordance with ASC 470,Debt – Debt with Conversions and Other Options, the Company determined that the multiple financial instruments issued in the convertible promissory notes resulted in an allocation of the fair value between the convertible note and the share purchase warrants which resulted in a discount on the convertible notes of $3,600 that was recorded against the note payable and a corresponding credit to additional paid-in capital.  On December 4, 2009, the Company converted the note into common shares.  

b)

On November 13, 2009, the Company issued a note payable of $12,203 to a third-party company for payment of expenditures on the Company’s behalf.  Under the terms of the note payable, the amount is unsecured, due interest at 10% per annum, and is due on demand.  On December 4, 2009, the Company converted the note into common shares.  

10

SINO PAYMENTS, INC.

(formerly China Soaring, Inc.)

(A Development Stage Company)

Notes to the Financial Statements

February 28,May 31, 2010

(unaudited)

3.

Notes Payable(continued)

c)

On November 13, 2009, the Company converted $3,300 of amounts owing to the President of the Company into a convertible promissory note.  Under the terms of the note agreement, the amount is unsecured, non-interest bearing, due on demand, and convertible into common shares of the Company at $0.05 per common share at the discretion of the note holder commencing from the issuance date.  The Company evaluated the convertible note pursuant to ASC 815,Disclosures about Derivative Instruments and Hedging Activities,and determined that it did not qualify for derivative treatment.  On December 4, 2009, the Company converted the note into common shares.

d)

In April 2010, the Company issued a loan payable of $6,832.  Under the terms of the loan, the amount owed is unsecured, non-interest bearing, and due on demand,  Refer to Note 7.  

4.

Related Party Transactions

a)

As at February 28,May 31, 2010, the Company owes $nilis owed $65 (August 31, 2009 - $13,214)– Company owed $13,214 to the President of the Company) from the President of the Company for payment of general operating expenditures.  The amounts owing are unsecured, non-interest bearing, and due on demand.

b)

As at February 28,May 31, 2010, the Company owes $nil (August 31, 2009 - $120) to a Director of the Company for payment of general operating expenditures.  The amounts owing are unsecured, non-interest bearing, and due on demand.

c)

As at February 28,May 31, 2010, the Company owes $7,377$7,312 (August 31, 2009 - $7,376) to a shareholder of the Company for payment of general expenditures.  The amounts owing are unsecured, due interest at 4% per annum, and due on demand.

d)

Refer to Note 3(c).  

5.

Common Shares

a)

On February 17, 2010, the Company issued 1,600,000 common shares with a fair value of $32,000 for current and future professional services of $27,000 resulting in a loss on settlement of debt of $5,000.

b)

On December 9, 2009, the Company issued 484,160 common shares with a fair value of $19,366 for payment of management fees.

c)

On December 9, 2009, the Company issued 293,504 common shares with a fair value of $11,740 for settlement of amounts owing to related parties of $11,070, resulting in a loss on settlement of debt of $670.

d)

On December 4, 2009, the Company issued 66,500 common shares at $0.05 per share to settle a convertible note owing of $3,300 plus accrued interest of $28.  

e)

On December 4, 2009, the Company issued 471,961 common shares at $0.05 per share to settle convertible and promissory notes of $19,403 plus accrued interest of $195 and a further cash contribution of $4,000.  

f)

On December 1, 2009, the Company issued 120,000 common shares with a fair value of $4,800 to settle consulting fees of $5,000, resulting in a gain on settlement of $200.

g)

On November 17, 2009, the Company issued 250,000 common shares with a fair value of $10,000 to settle professional services of $7,500 resulting in a loss on settlement of debt of $2,500.

h)

On November 17, 2009, the Company cancelled 1,120,000 common shares and returned them to treasury.  

11

SINO PAYMENTS, INC.

(formerly China Soaring, Inc.)

(A Development Stage Company)

Notes to the Financial Statements

February 28,May 31, 2010

(unaudited)

6.

Share Purchase Warrants

On October 20, 2009, the Company issued 50,000 share purchase warrants to a third-party company.  Each warrant grants the warrant holder the option to purchase one additional common share of the Company at $0.075 per common share for a period of three years from the date of issuance.  The Company valued the share purchase warrants using the Black-Scholes Option Pricing model with the assumptions of useful life of three years, volatility of 271%, and a risk free rate of 1.44%.

During the sixnine months ended February 28,May 31, 2010, the Company issued the following share purchase warrants:

As at September 30, 2009, the following share purchase warrants were outstanding:

7.

Subsequent EventsEvent

On March 30,June 15, 2010, the Company issued 1,210,200 common shares withobtained a fair value$150,000 line of $36,306 to settle management fees owing.

In accordance with ASC 855,Subsequent Events,credit from a private investor.  Under the Company has evaluated subsequent events through April 19, 2010, the date the financial statements were issued. During this period, the Company did not have any material recognizable subsequent events with the exceptionterms of the above-noted.

line of credit, the amount is unsecured, due interest at 8% per annum, and due on demand.  The loan payable noted in Note 3(d) was converted into the line of credit.  

ITEM2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION

FORWARD-LOOKING STATEMENTS

 This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements are not historical facts but rather are based on current expectations, estimates and projections. We may use words such as “anticipate,” “expect,” “intend,” “plan,” “believe,” “foresee,” “estimate” and variations of these words and similar expressions to identify forward-looking statements. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and other factors, some of which are beyond our control, are difficult to predict and could cause actual results to differ materially from those expressed or forecasted. You should read this report completely and with the understanding that actual future results may be materially different from what we expect. The forward looking statements included in this report are made as of the date of this report and should be evaluated with consideration of any changes occurring after the date of this Report. We will not update forward-looking statements even though our situation may change in the future and we assume no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

Please note that throughout this Quarterly Report, except as otherwise indicated by the context, references in this report to “Company”, “SNPY”, “we”, “us” and “our” are references to Sino Payments, Inc.  All references to “USD” or United States Dollars refer to the legal currency of the United States of America.

GENERAL

Sino Payments, Inc. was incorporated in the State of Nevada on June 26, 2007 under the name China Soaring Inc. On November 26, 2008, we effected a name change to Sino Payments, Inc. Since inception, we incorporated the company, hired the attorney, and hired the auditor for the preparation of all quarterly and annual reports. We have made significant steps to develop and further our business plan, including creating our Global Processing Platform (“SinoPay GPP”) and establishing our website, ww.sinopayments.com.www.sinopayments.com. We are a credit card processing and merchant acquiringmerchant-acquiring services company that provides credit card clearing services to merchants and financial institutions in China. Sino Payments’ objective is to be a provider of IP (Internet Protocol) processing services in Asia to bankcard accepting merchants.

The shares of our common stock have traded on the Over-the-Counter Bulletin Board under the symbols “CHIJ.OB” since October 29, 2008 and “SNPY.OB” since December 16, 2008.

CURRENT BUSINESS OPERATIONS

The Chinese market for credit cards, in terms of total credit card loans, is expected to grow over the next few years at a compounded annual rate of growth in of 88%, from US$300 million in 2003 to US$13.2 billion in 2009. Yet the transaction processing sector remains significantly underserved. Sino Payments will pursue merchants with large regional retail locations across Asia Pacific as potential customers of its IP and related credit card and debit card processing systems. No providers are currently dominant. Competitors are expected to include Chinese banks’ in-house solutions and their affiliated technical solution partners. Sino Payments expects to offer superior interoperability, a highly-efficient infrastructure and exceptional knowledge of the IP processing market throughout our SinoPay GPP platform, which, when completed, will be fully-integratable, widely-deployed, and developed in conjunction with strategic partners. Sino Payments intends to deploy the most flexible and lowest-cost IP processing system in Asia with a focus on China, Hong Kong, Thailand, Philippines, Malaysia, Korea, and Japan.

Sino Payments’ strategy is to continue to market credit card processing services to retail merchants in targeted markets,markets; offer its merchant acquiring base to selected banks,banks; provide support using world-class technology platforms,platforms; and maximize strategic partnerships to accelerate market development. Our initial focus is on China and Hong Kong basedKong-based multinational retailers with expansion into other Asian markets as we develop. Development objectives have been selected and an organization for executing on those objectives has been put in place.

Description of Business

The senior executives of Sino Payments are well-known and respected in the transaction processing industry throughout the Asia-Pacific region. The directors bring extensive international and public company experience to bear and have built an impressive track record of successful start-ups. As of the date hereof, the Company has completed the following:

13

On August 1, 2008 we completed a public offering whereby we sold 4,860,000 shares of common stock to 50 investors, thereby raising $81,000.

On April 23, 2009, we completed our Global Processing Platform (“SinoPay GPP”) and we have deployed this solution in Shanghai to provide IP credit and debit card processing services to customers in China and to use the platform in basically its existing state for processing retail cardcards at point of sale systems throughout Asia and elsewhere. This updated SinoPay GPP system will facilitate the processing of all credit card types (Visa/MC/AMEX/Diners/Discover/JCB) and will be integrated with China UnionPay to provide processing of UnionPay Debit cards in China. The SinoPay GPP can be deployed in any country to provide efficient IP processing of all credit card types and has been specifically designed for roll out around the region in Asia.

On April 29, 2009, we entered into aService Agreement with PowerE2E China, a Chinese corporation (“PowerE2E”) to provide credit and debit card processing services in China. The agreement is for card processing services for PowerE2E’s clients, as well as directly for PowerE2E transactions. The first project is for an ecommerce client site, and PowerE2E and Sino Payments are working on additional joint business development opportunities to provide service to PowerE2E’s existing customer base. The SinoPay GPP system is being deployed on site at PowerE2E’s Headquarter location in Shanghai.

On May 27, 2009, we signed a Memorandum of Understanding with BCS Holdings, Inc., a California corporation (“BCS”) to cooperate in identifying and acquiring additional merchants in China and Asia. Sino Payments and BCS have undertaken to cooperate to develop a merchant sales and marketing program for Greater China and other countries in Asia by the end of 2009 on behalf of Sino Payments. BCS is a full service payment solutions provider for traditional and internet businesses, with strategic partnerships and alliances with Chase Paymentech, National Processing Company, First Data, Bank of America, Telecheck, Verifone, Discover Network, China UnionPay, JCB International Credit Card Co., Ltd. and United Commercial Bank.

On September 22, 2009, we signed a pay sourcing agreementwith PAY.ON Asia, Ltd., a Hong Kong Company (“PAY.ON”) whereby PAY.ON has agreed that we shall have the right to use and incorporate PAY.ON technologies relating to the handling of services related to payment and fraud control in the operation of our business. Such technologies shall be provided to us at a minimum monthly price of EUR 1,500 and a maximum monthly price of EUR 1,800.

On September 29, 2009, we executed a Reseller Agreement with eNETS Hong Kong Ltd. (“eNETS”),whereby eNETS and weSino Payments have agreed that we shall have the right to market and sell the eNETS payment gateway system, which is a direct debit and credit card payment gateway that allows users to receive payment of transactions electronically. Pursuant to the terms of the Agreement, we shall pay to eNETS a pre-determined rate for each transaction processed as fully set forth in the Agreement.

Quarterly Developments

On December 9, 2009, the Company announced that it completed e-commerce integration for processing credit and debit cards in most major currencies in over 40 countries worldwide.

On December 17, 2009, Malone & Bailey, LLP (“MB”), was dismissed as the registered independent public accountant for the Company. Concurrently, M&K CPAS, PLLC (“MKC”) was appointed as the registered independent public accountant for the Company. The decisions to appoint MKC and dismiss MB were approved by the Board of Directors of the Company on December 17, 2009.

On January 6, 2010, the Company announced that it had completed version 2.0 of the core Sino Payments Global Payment Processing platform, "SinoPay GPP," for processing credit and debit cards from cash registers and point of sale checkout machines widely used by most retailers worldwide.

On January 20, 1010, the Company announced that that we signed an agreement with Valitor as an agent to refer European credit and debit card-accepting merchants.

On January 27, 2010, the Company announced that it signed an agreement with Payvision, one of the leading international payment solutions providers for the card-not-present marketplace, as an agent for the sale of credit and debit card merchant accounts.

Subsequent to February 28, 2010:Quarterly Developments

On March 25, 2010, the Company announced our submission of the first of three ecommerce merchant account applications for acquiring bank partners Payvision and Valitor.

On April 9, 2010, the Company announced that it submitted the first US ecommerce merchant account application to an existing bank partner.

On April 28, 2010, the Company announced that it expects to open an office in Shenzen China in the near future.

14

Subsequent to May 31, 2010:

On June 2, 2010, the Company announced that it has received approval from both Visa and Mastercard as a merchant referral agent for clearing bank VALITOR, which will allow Sino Payments to promote cross regional projects for large retailers who are present in both Asia and Europe.

On June 4, 2010, the Company entered into a Line of Credit Note (the “Note”) with Moon Gate Limited. Under the terms of the Note, the Company may borrow, from time to time, up to the maximum principal amount of the Note, which is $150,000, for general working capital. The minimum advance under the Note is $1,000 and the interest rate of the Note is 8%. The Note is unsecured and all borrowings plus interest are due on demand.

Our Strategy

We intend to provide credit and debit card processing services primarily to retail stores located in Asia. Our new CEO & Chairman, Matthew Mecke, will be responsible for providing these services. We intend to target companies that maintain regional retail store operations in Asia. We intend to provide credit and debit card processing services to retailers such as large department stores, regional supermarket chains, and other retailers with a presence in multiple markets in Asia to specifically include China.

Regulatory Requirements

We do not need to pursue nor satisfy any special licensing or regulatory requirements before establishing or delivering our intended services other than requisite business licenses. If new government regulations, laws, or licensing requirements are passed that would cause us to restrict or eliminate delivery of any of our intended services, then our business would suffer. For example, if we were required to obtain a government issued license for the purpose of providing coaching and consulting services, then we could not guarantee that we would qualify for such license. If such a licensing requirement existed, and we were not able to qualify, then our business would suffer. Presently, to the best of our knowledge, no such regulations, laws, or licensing requirements exist or are likely to be implemented in the near future that would reasonably be expected to have a material impact on or sales, revenues, or income from our business operations.

Marketing

Our services are promoted by Mr. Mecke. He will discuss our services with contacts he has established. We also anticipate utilizing several other marketing activities in our attempt to make our services known to corporations and attract clientele. These marketing activities will be designed to inform potential clients about the benefits of using our services and will include the following: development and distribution of marketing literature; direct mail and email; advertising; promotion of our web site; and industry analyst relations.

Revenue

Initially, we intend to generate revenue from three sources:

1.

Term Fee - By charging a fee for given services;

2.

Fixed Fee - By charging a fixed fee;

3.

Transaction Fee - By charging a transaction fee for processing credit or debit card transactions.

We intend to develop and maintain a database of all of our clients so that we can anticipate various needs and continuously build and expand our advisory services. There is no assurance that we will be able to interest any retail store operators in our target market.

Insurance

We do not maintain any insurance and do not intend to maintain insurance in the future. Because we do not have any insurance, if we are made a party to a liability action, we may not have sufficient funds to defend the litigation. If that occurs, a judgment could be rendered against us that could cause us to cease operations.

Network Security

We will, if successful, compile and maintain a large database of information relating to our merchants and their transactions. We intend to focus significant resources on maintaining a high level of security in order to protect the information of our merchants and their customers.

Competition

The payment processing industry is highly competitive. We compete with other providers of payment processing services on the basis of the following factors: quality of service; reliability of service; ability to evaluate, undertake and manage risk; speed in approving merchant applications; and price.

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We will be competing with both small and large companies in providing payment processing and related services to a wide range of merchants. Our competitors sell their services either through a direct sales force, generally concentrating on larger accounts, or through Independent Sales Organizations, telemarketers or banks, generally concentrating on smaller accounts. There are a number of large payment processors, including First Data Corporation, Bank of America Corporation, Global Payments Inc., Fifth Third Bank, Chase Paymentech Solutions and Elavon, Inc., a subsidiary of U.S. Bancorp, that serve a broad market spectrum from large to small merchants; further, certain of these provide banking, ATM, and other payment-related services and systems in addition to bank card payment processing. There are also a large number of smaller payment processors that provide various services to small- and medium-sized merchants.

Some of our competitors have substantially greater capital resources than we have and operate as subsidiaries of financial institutions or bank holding companies, which may allow them on a consolidated basis to own and conduct depository and other banking activities that we do not have the regulatory authority to own or conduct. Since they are affiliated with financial institutions or banks, these competitors do not incur the costs associated with being sponsored by a bank for registration with card networks and they can settle transactions quickly for their own merchants. We do not,not; however, currently contemplate acquiring or merging with a financial institution in order to increase our competitiveness.

Offices

Our offices are currently located at Unit T25, GF Bangkok Bank Building, 18 Bonham Strand West, Sheung Wan , Hong Kongand our telephone number is (852)+(852) 8121 4220 . This is the rental office that we maintain where we sublet desk space, telephone, office services and space for computer equipment. As of the date of this filing, we have not sought to move or change our office site.

Employees; Identification of Certain Significant Employees

Matthew Mecke, our chief executive officer and director devotes approximately 60 hours a week of his time to our operations. We currently have no other employees, other than our officers and directors. We also frequently use third party consultants to assist in the completion of various projects. Third parties are instrumental to keep the development of projects on time and on budget.

Government Regulation

We are not currently subject to direct Chinese, federal, state or local regulation other than regulations applicable to businesses generally or directly applicable to electronic commerce. However, the Internet is increasingly popular. As a result, it is possible that a number of laws and regulations may be adopted with respect to the Internet. These laws may cover issues such as user privacy, freedom of expression, pricing, content and quality of products and services, taxation, advertising, intellectual property rights and information security. Furthermore, the growth of electronic commerce may prompt calls for more stringent consumer protection laws. Several states have proposed legislation to limit the uses of personal user information gathered online or require online services to establish privacy policies.

We are not certain how business may be affected by the application of existing laws governing issues such as property ownership, copyrights, encryption and other intellectual property issues, taxation, libel, obscenity and export or import matters. The vast majority of such laws were adopted prior to the advent of the Internet. As a result, they do not contemplate or address the unique issues of the Internet and related technologies. Changes in laws intended to address such issues could create uncertainty in the Internet market place. Such uncertainty could reduce demand for services or increase the cost of doing business as a result of litigation costs or increased service delivery costs. In addition, because our services are available over the Internet in multiple states and foreign countries, other jurisdictions may claim that we are required to qualify to do business in each such state or foreign country. We are qualified to do business only in Nevada . Our failure to qualify in a jurisdiction where it is required to do so could subject itus to taxes and penalties. It could also hamper our ability to enforce contracts in such jurisdictions. The application of laws or regulations from jurisdictions whose laws currently apply to our business could have a material adverse affect on our business, results of operations and financial condition.

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RESULTS OF OPERATIONS

Working Capital

Cash Flows

Operating Revenues

We have not generated any revenues since inception.

Operating Expenses and Net Loss

Operating expenses for the three months ended February 28,May 31, 2010 was $125,618$56,421 compared with $45,065$78,163 for the three months ended February 28,May 31, 2009.  The increase of $80,553decrease in operating expenditures was attributed to $79,500lower amounts of investor relations incurred duringprofessional fees relating to the quarter.           Company’s filings.

Net loss for the sixnine months ended February 28,May 31, 2010 was $195,513$252,120 compared with $49,318$127,555 for the sixnine months ended November 30,May 31, 2009.  The overall increase in net loss of $146,195$124,565 was attributed to $79,500 of investor relations, and $36,000 of management fees that commenced during fiscal 2010.  The remaining increase in net loss was attributed to professional services incurred with the Company’s SEC filings including accounting, audit, and legal services.  

 Liquidity and Capital Resources

As at February 28,May 31, 2010, the Company’s cash balance was $22$9 compared to $7 as at August 31, 2009 and its total assets were $11,092$1,579 compared with $777 as at August 31, 2009.  The increase in total assets is attributed to prepayment of $10,300$800 in professional fees.  

As at February 28,May 31, 2010, the Company had total liabilities of $111,672$158,766 compared with total liabilities of $93,113 as at August 31, 2009.  The increase in total liabilities was attributed to increases in accounts payable and accrued liabilities of $35,942$76,269  as the Company did not have sufficient cash flow to settle obligations.  The increase was offset by the settlement of related party debt of $13,333 and the settlement of $4,050 of convertible notes payable with the issuance of common shares.           $13,333.

As at February 28,May 31, 2010, the Company had a working capital deficit of $101,350 compared with a working capital deficit of $93,106 as at August 31, 2009.  The increase in working capital deficit was attributed to the increase in accounts payable and accrued liabilities of $35,942 due to the lack of sufficient cash flow to pay its obligations offset by the prepayment of professional services of $10,300 and settlement of related party debt of $13,333 and convertible debt of $4,050 with the issuance of common shares.       

Cashflow from Operating Activities

During the sixnine months ended February 28,May 31, 2010, the Company used $17,224$24,004 of cash for operating activities compared to the use of $12,234$13,397 of cash for operating activities during the sixnine months ended February 28,May 31, 2009. The increase in cashflows used for operating activities is attributed to the fact that the Company received $16,203$23,035 of financing from notes payable, of which the majority was used to settle outstanding obligations of the Company.Company with the remaining debt amounts settled by the issuance of common shares.

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Cashflow from Investing Activities

During the sixnine months ended February 28,May 31, 2010 and 2009, the Company did not have any cash transactions related to investing activities.

Cashflow from Financing Activities

During the sixnine months ended February 28,May 31, 2010, the Company received $17,239$24,006 of cash from financing activities compared to $8,206 for the sixnine months ended February 28,May 31, 2009.  The increase in cashflows provided from financing activities is based on the fact that the Company received $16,203$23,035 of financing from a third-party and $1,036$971 from related parties to settle outstanding obligations of the Company during the day-to-day operations as compared to only $8,206 in 2009.  

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to our investors.

Critical Accounting Policies

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes for the reporting period. Significant areas requiring the use of management estimates relate to the valuation of its mineral leases and claims and our ability to obtain final government permission to complete the project.

Stock-Based Compensation

The Company records stock-based compensation in accordance with ASC 718,Compensation – Stock Compensation, using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. Equity instruments issued to employees and the cost of the services received as consideration are measured and recognized based on the fair value of the equity instruments issued.

Recent Accounting Pronouncements

In August 2009, FASB issued an amendment to the accounting standards related to the measurement of liabilities that are recognized or disclosed at fair value on a recurring basis. This standard clarifies how a company should measure the fair value of liabilities and that restrictions preventing the transfer of a liability should not be considered as a factor in the measurement of liabilities within the scope of this standard. This standard is effective for the Company on October 1, 2009. The adoption of this amendment did not have a material effect on the Company’s consolidated financial statements.

In October 2009, FASB issued an amendment to the accounting standards related to the accounting for revenue in arrangements with multiple deliverables including how the arrangement consideration is allocated among delivered and undelivered items of the arrangement. Among the amendments, this standard eliminated the use of the residual method for allocating arrangement considerations and requires an entity to allocate the overall consideration to each deliverable based on an estimated selling price of each individual deliverable in the arrangement in the absence of having vendor-specific objective evidence or other third party evidence of fair value of the undelivered items. This standard also provides further guidance on how to determine a separate unit of accounting in a multiple-deliverable revenue arrangement and expands the disclosure requirements about the judgments made in applying the estimated selling price method and how those judgments affect th e timing or amount of revenue recognition. This standard, for which the Company is currently assessing the impact, will become effective on January 1, 2011.

In October 2009, the FASB issued an amendment to the accounting standards related to certain revenue arrangements that include software elements. This standard clarifies the existing accounting guidance such that tangible products that contain both software and non-software components that function together to deliver the product’s essential functionality, shall be excluded from the scope of the software revenue recognition accounting standards. Accordingly, sales of these products may fall within the scope of other revenue recognition standards or may now be within the scope of this standard and may require an allocation of the arrangement consideration for each element of the arrangement. This standard, for which the Company is currently assessing the impact, will become effective on January 1, 2011.

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In January 2010, the FASB issued an amendment to ASC 505, Equity, where entities that declare dividends to shareholders that may be paid in cash or shares at the election of the shareholders are considered to be a share issuance that is reflected prospectively in EPS, and is not accounted for as a stock dividend.  This standard is effective for interim and annual periods ending on or after December 15, 2009 and is to be applied on a retrospective basis.  The adoption of this standard is not expected to have a significant impact on the Company’s financial statements.  

In January 2010, the FASB issued an amendment to ASC 820, Fair Value Measurements and Disclosure, to require reporting entities to separately disclose the amounts and business rationale for significant transfers in and out of Level 1 and Level 2 fair value measurements and separately present information regarding purchase, sale, issuance, and settlement of Level 3 fair value measures on a gross basis.  This standard, for which the Company is currently assessing the impact, is effective for interim and annual reporting periods beginning after December 15, 2009, with the exception of disclosures regarding the purchase, sale, issuance, and settlement of Level 3 fair value measures which are effective for fiscal years beginning after December 15, 2010.  

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

ITEM 4. CONTROLS AND PROCEDURES

Management’s Quarterly Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms.  Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by our company in the reports that it files or submits under the Exchange Act is accumulated and communicated to our management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Our management carried out an evaluation under the supervision and with the participation of our Chief Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation o f our disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 ("Exchange Act").  Based upon that evaluation, our Chief Executive Officer and Principal Financial Officer have concluded that our disclosure controls and procedures were not effective as of February 28,May 31, 2010, due to the material weaknesses resulting from not having an Audit Committee or a financial expert on our Board of Directors and our failure to maintain appropriate cash controls. Please refer to our Annual Report on Form 10-K as filed with the SEC on December 19, 2009, for a complete discussion relating to the foregoing evaluation of Disclosures and Procedures.

Changes in Internal Control Over Financial Reporting

There were no changes in internal controls over financial reporting that occurred during the three months ended February 28,May 31, 2010, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

We are not a party to any pending legal proceeding. No federal, state or local governmental agency is presently contemplating any proceeding against the Company. No director, executive officer or affiliate of the Company or owner of record or beneficially of more than five percent of the Company's common stock is a party adverse to the Company or has a material interest adverse to the Company in any proceeding.

ITEM 1A. RISK FACTORS.

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

1.

Issuance of Equity Securities in exchange for services:

§

On December 7, 2009 the RegistrantCompany issued 2,650,000 shares of its common stock as payment for services.services pursuant to Section 4(2) and/or Regulation D.    

§

On December 10, 2009 the RegistrantCompany issued 584,286 shares of its common stock to Mathew Mecke representing 320,000 as payment for services rendered and 264,286 for reimbursement of expenses.expenses pursuant to Section 4(2) and/or Regulation D.

§

On December 10, 2009 the RegistrantCompany issued 111,298 shares of its common stock to Paul Manning representing 82,080 as payment for services rendered and 29,218 for reimbursement of expenses.expenses pursuant to Section 4(2) and/or Regulation D.    

§

On December 10, 2009 the RegistrantCompany issued 82,080 shares of its restricted common stock as payment for monthly services rendered by Anthony Robinson.Robinson pursuant to Section 4(2) and/or Regulation D.  

§

On March 30, 2010 the Company issued 800,000 shares of its restricted common stock to Mathew Mecke as payment for monthly services rendered pursuant to Section 4(2) and/or Regulation D.

§

On March 30, 2010 the Company issued 205,200 shares of its restricted common stock to Paul Manning as payment for monthly services rendered pursuant to Section 4(2) and/or Regulation D.    

§

On March 30, 2010 the Company issued 205,200 shares of its restricted common stock as payment for monthly services rendered by Anthony Robinson pursuant to Section 4(2) and/or Regulation D.  

2.

Convertible Securities:

§

On December 7, 2009, the RegistrantCompany issued 66,550 shares of its common stock to Mathew Mecke pursuant to the conversion of a Note, the principal and interest converted were valued at $3,327.50.

§

On December 7, 2009, the RegistrantCompany issued 471,961 shares of its common stock to Moon Gate Limited pursuant to the conversion of a Note, the principal and interest converted waswere valued at 23,598.03.

3.

Outstanding Warrants:

§

On October 20, 2009, the Company issued 50,000 share purchase warrants to a third-party company. Each warrant grants the warrant holder the option to purchase one additional common share of the Company at $0.075 per common share for a period of three years from the date of issuance.

4.4.

Sales of Equity Securities for Cash:

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

NoneNone.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

None

ITEM 5. OTHER INFORMATION.

NoneNone.

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ITEM 6. EXHIBITS

The following exhibits are filed with this Quarterly Report on Form 10-Q:

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

SINO PAYMENTS, INC.

Dated: April 19,August 3, 2010

By:

 /s/ Matthew Mecke      

MATTHEW MECKE

President and CEO

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