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Cash payment is becoming obsolete in China

Mobile payment is altering the Chinese daily commerce landscape at an incredible speed. Electronic payment systems are spreading while cash is rapidly becoming obsolete. From spices shops to restaurants, almost all businesses are favoring mobile payment. And in many cases, paper money is even no more a valid form of payment.

The lack of red tape paved the way for mobile payments

China has grasped that excessive red tape may put a restraint on business development. With the clear goal to boost business, manufacturing, and investment, as well as create a booming business environment, China has decided to snip red tape at various levels. Technology-based services are hence endowed with simpler approval process as well as lower corporate fees. Central authorities have taken the decision to nurture the growth of online businesses.
Transactions, both online and offline, are being streamlined towards the use of mobile payment. Today, it is more common today to ask if a retailer accepts Alipay than a credit card, for instance. A recent report by the University of China and research company Ipsos highlighted that 40% of the Chinese population go out with less than $15 (100RMB) as cash, relying almost exclusively on mobile payment options.

China leapfrogged in mobile payment solutions

The myriad of incentives to boost e-commerce and mobile payment solutions, as well as the keenness and formidable adaptability of the Chinese population at large have allowed China to leapfrog in the mobile payment industry. Data from Analysys cited by Hillhouse Capital pinpointed that the mobile payment volume in China witnessed a more than double increase in 2016 and reached $5 trillion. In the first quarter of 2017, Alipay had its grasp on 54% of the mobile payments market while WeChatPay had hold on 40%. Alipay has 520 million users while the WeChat app has 963 users.
Today, it is almost impossible to conduct certain transactions without mobile payment in China. Chinese calligraphy stores, taxis or even renting a bicycle may need the customer to use a QR code.

Mobile payment as a means to maintain control

China is a country that loves to have control on what is happening. The dominance of mobile payments in the country equally implies that the providers detain hordes of personal data. This data can be shared with the Chinese government. However, privacy issues do not seem to bother the Chinese consumers who, above all, prefer mobile payments for their unparalleled level of convenience in daily transactions.

Chinese mobile payment trend is crossing borders

The Chinese mobile payment trend is not only affecting the Chinese population. Indeed, as approximately 6 million Chinese travel in October, tourist destinations such as Hong Kong and Japan are being forced to innovate to offer mobile payment solutions to keep pace. Another reason pushing other countries to offer high-end mobile payment systems is, of course, business deals with China; Chinese companies are increasingly forming part of the economic landscapes of various countries in terms of retail.
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