Tuesday, October 10, 2017
China ‘Pretty Much’ Already Cashless
Chinese consumers have increasingly opted for “mobile pay” options for retail transactions.
Mainland Chinese stores and services are increasingly centered around mobile pay apps like WeChat Pay and Alipay according to CNBC. That accounts for roughly $5 trillion worth of revenue in which not even a single physical yuan exchanged hands.
The prevalence of mobile pay-only businesses makes it difficult for foreign visitors to conduct retail transactions without one of the government-approved mobile payment apps. In turn, that means the government is better able to monitor all financial transactions happening within its borders.
The report further states:
Lack of red tape and a less developed financial system have apparently allowed mainland China to leapfrog the developed world into embracing mobile payments …
In the first quarter of this year, Alipay had 54 percent of that mobile payments market, and WeChat Pay accounted for 40 percent, the study said.
The Chinese mobile pay habit is also affecting other countries. More than 6 million Chinese traveled abroad during the "Golden Week" national holiday in early October, according to state-backed media outlet Xinhua. That puts pressure on popular tourist destinations like Japan and Hong Kong to add mobile pay services.
CNBC notes that this growth of mobile pay in China is a direct result of the rapid expansion of smartphone usage in the country, where exchanging WeChat “adds” has replaced the customary exchange of business cards. The expansion of mobile pay is expected to grow to 300 trillion yuan ($45.3 trillion) in the next four years.
Credit to TruNews