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In Urban China, Cash Is Rapidly Becoming Obsolete

nytimes.com

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Re: In Urban China, Cash Is Rapidly Becoming Obsolete

#131

Post by seanmcdirmid »

nickrio wrote: post #54
mahyarm wrote: post #25

Earlier quoted context omitted.

Android was released a couple years after the iphone and it has defined the low end market. From the USA. A big reason why QR codes caught on in China is because everything else was really bad. In america, credit cards were 'good enough' compared to what was in china, so QR codes didn't catch on that quickly. Also because it's a wealthier nation, the typical merchant could afford the hardware required for processing…

I'm a Chinese & living China, I shopping almost only with credit cards and cash for privacy consideration. However, I don't think credit cards in China are as popular as it is in the USA. I could guess most Chinese people don't have any credit card. Chinese traditional culture encourages saving, not loaning. And taking small loans is exactly how credit cards works. So maybe that's why people here don't like credit ca…

I think most people pay their balance off every month in the USA. Credit card doesn't mean borrowing. The big problem with credit cards in China is fraud: banks like ICBC will put the burden of proof on the card holder when a fraud transaction occurs, rather than the merchant as in the west. I really hate ICBC.

Anyways, debit cards work just like QR pay does, just like UnionPay already does. The problem QR codes are solving is the lack of a POS terminal and stream lining the swipe. Many countries have an even better technology in NFC contact (including China, many newer UnionPay POS's include NFC, though the card must have a chip to support it). Then you could just glue your debit card to the back of your phone...(or use NFC in your phone via something like Apple or Android Pay).

Re: In Urban China, Cash Is Rapidly Becoming Obsolete

#132

Post by objclxt »

HeavenFox wrote: post #24

Born in China and moved to U.S. since college. In my observation, there are several reason for the boom in mobile payment in China that makes it hard to replicate. - Low transaction fee & minimal barrier. For merchants taking WeChat pay, the transaction fee seems to be a flat 0.6%, compared to 2%-3% in the U.S. For the food cart vendors and similar one man shops, they just use the person-to-person payment feature (li…

To add to this: it's not just low transactions fees for the merchant, it's cheaper payments for the customer as well.

Both Alipay and WeChat have spent billions subsidizing and discounting. Go into a restaurant in Beijing and there's a good chance you could get 10 or 15% off your bill by paying with WeChat.

So given that it's both cheaper for the merchant and cheaper for the customer it's no surprise it has taken off so much.

Re: In Urban China, Cash Is Rapidly Becoming Obsolete

#133

Post by seanmcdirmid »

svckr wrote: post #129
csydas wrote: post #87

Earlier quoted context omitted.

Maybe the data doesn't back this, but as a US citizen I find that most of the time when people refer to credit cards they're meaning their Bank card, which often acts as whatever you define it as at the terminal or it has a default status for quick pay options. There are many people that are happy to just pull out the credit card to buy beyond their means but a lot of the time people are using a card backed directly…

Here in Germany we have a clear distinction between credit- and debit cards. And I guess the culture leans more toward the "saving not loaning" model nickrio describes. So for me it is a conscious decision wether I pay with my bank account or credit. Unlike China however, adoption of digital, low-barrier payments is extremely low here. I mean, hell, we're mostly buying paper bus tickets, while local public transport…

When I lived to Switzerland, I was pretty surprised my debit card (Maestro) couldn't work on credit card networks (Master Card, heck, the logos looked almost the same!).

I'm surprised Germany is so far behind switzerland though, I mean, even when I lived there 10 years ago I could use my debit card via chip in a kiosk and have my train ticket very quickly.

I don't think standard Beijing city buses take wepay yet. You still hand over paper bills to the conductor or use your beijing transit NFC card.

Re: In Urban China, Cash Is Rapidly Becoming Obsolete

#134

Post by Symbiote »

svckr wrote: post #129
csydas wrote: post #87

Earlier quoted context omitted.

Maybe the data doesn't back this, but as a US citizen I find that most of the time when people refer to credit cards they're meaning their Bank card, which often acts as whatever you define it as at the terminal or it has a default status for quick pay options. There are many people that are happy to just pull out the credit card to buy beyond their means but a lot of the time people are using a card backed directly…

Here in Germany we have a clear distinction between credit- and debit cards. And I guess the culture leans more toward the "saving not loaning" model nickrio describes. So for me it is a conscious decision wether I pay with my bank account or credit. Unlike China however, adoption of digital, low-barrier payments is extremely low here. I mean, hell, we're mostly buying paper bus tickets, while local public transport…

The Nordic countries also have that distinction, indeed credit cards are often charged 1-3% in fees, while debit cards are usually free.

That hasn't prevented the demise of cash, and MobilePay, Swish etc are popular for personal and commercial transactions.

The RFID card works on all public transport all across Denmark. Sweden has regional systems. I don't know about elsewhere.

The leader for this is London, where any contactless payment card works on public transport.

Re: In Urban China, Cash Is Rapidly Becoming Obsolete

#135

Post by seanmcdirmid »

RealityNow wrote: post #73
thablackbull wrote: post #21

I think this is a good illustration of the different approach in how China and America approach the consumer economics space. In America, there is a very heavy reliance on "trickle down". We create a "best-in-class", "top-of-the-line" product that only the elite and wealthy can buy into. These people then set the tone of how it will develop in the future. The first mover also tries to do everything in their power to…

I live in NYC, and most stores seem to have $5-10 credit card minimums. America needs to admit that it's no longer the bastion of innovation that it once was (I say this as an American. If anyone doesn't believe me, just take a trip to East Asia). Americans are complacent and fine with not having the cutting edge (not to mention our failing infrastructure). I wish there was a way to change this attitude, but it feels…

Went to the donut shop, got a $1.50 donut with a credit card, no minimums here in LA. This NYC place sounds fairly strange.

I lived in Beijing for 9 years. It changed much since then, but the tech brought out was solving mostly local problems with local solutions. When I started living there, I used to pay for rent by withdrawing 20K or so RMB from the ATM machine (in 100 bills), loading it into a bag, then giving it the landlord. I never did that in the USA before, never had to, it wasn't the problem the USA had. Now I can use Wepay, oh, or I can go to the bank and do a direct funds transfer (as a foreigner, I could never get ebanking setup).

> If every American had to fly to Tokyo or Seoul for a week, I think we'd put up less with our failing infrastructure.

All of these places have their own thing. Don't get confused and think that the problems they are solving are much better than the ones we are. I've had plenty of trouble in Tokyo that I wouldn't experience in the states (dammit, streets should have names!), they are just different.

Re: In Urban China, Cash Is Rapidly Becoming Obsolete

#136

Post by seanmcdirmid »

HeavenFox wrote: post #24

Born in China and moved to U.S. since college. In my observation, there are several reason for the boom in mobile payment in China that makes it hard to replicate. - Low transaction fee & minimal barrier. For merchants taking WeChat pay, the transaction fee seems to be a flat 0.6%, compared to 2%-3% in the U.S. For the food cart vendors and similar one man shops, they just use the person-to-person payment feature (li…

> For merchants taking WeChat pay, the transaction fee seems to be a flat 0.6%, compared to 2%-3% in the U.S.

Where the heck is 3% even allowed in the USA?

> However, it's quite difficult to argue that taking out the phone, unlock it, open the app and show the QR code is easier than using a card in the western world.

Tapping the card to the NFC terminal is super easy. You don't even need to take your card out of the wallet if its in front.

Re: In Urban China, Cash Is Rapidly Becoming Obsolete

#137

Post by ajdlinux »

seanmcdirmid wrote: post #131
nickrio wrote: post #54

Earlier quoted context omitted.

I'm a Chinese & living China, I shopping almost only with credit cards and cash for privacy consideration. However, I don't think credit cards in China are as popular as it is in the USA. I could guess most Chinese people don't have any credit card. Chinese traditional culture encourages saving, not loaning. And taking small loans is exactly how credit cards works. So maybe that's why people here don't like credit ca…

I think most people pay their balance off every month in the USA. Credit card doesn't mean borrowing. The big problem with credit cards in China is fraud: banks like ICBC will put the burden of proof on the card holder when a fraud transaction occurs, rather than the merchant as in the west. I really hate ICBC. Anyways, debit cards work just like QR pay does, just like UnionPay already does. The problem QR codes are…

http://time.com/money/4213757/average-american-credit-card-d...

Re: In Urban China, Cash Is Rapidly Becoming Obsolete

#138

Post by wklauss »

Hasz wrote: post #93

Cash will never die. Fundamentally, a wechat/alipay transaction is traceable. Traceability is great for expense reports, but a non-starter if you're a drug dealer -- especially with China's draconian drug laws. Even if you were to launder the money through fronts or a series of transactions, a state level actor (i.e, China) would have no real difficulty in tracking down such activity. With cash, this becomes much, mu…

> Cash will never die.

I wouldn't say never. It can be marginalized to the point that it becomes annoying for vendors to rely on it and all you need is a little bit of regulatory push to stop cash. By then, most shoppers would not care enough to protest.

As for drug dealers... what can I say... i don't think their needs will be taken into account and as far as I know, bitcoin is already working for them in that regard.

Re: In Urban China, Cash Is Rapidly Becoming Obsolete

#139

Post by seanmcdirmid »

pmontra wrote: post #127
theylon wrote: post #50

Living in China for the past two years - Important thing to remember - in China and in most of South-East Asia the tech boom came at a later stage when smartphones were already prominent. Android + Chinese manufacturing made it possible to produce cheap smart phones. The result is that these countries have completely skipped the laptop phase and went straight to smartphones, most of the population doesn't even know w…

I've been in China as a tourist for three weeks two years ago. I paid everything with cash. Easy. What would I do now if I have to pay with WeChat and I obviously don't have a Chinese bank account? Tourists don't have time to waste in banks and unless bank accounts are created and activated on the fly it would be pointless to open one. Maybe open an account in advance from home? Is that possible? Or WeChat and Alipay…

Cash is still accepted.

I used Kuai Didi without the payment option easily enough, just hail a taxi with the app, pay the meter with cash, simple easy done.

Many merchants take credit cards, ATM machines are pretty ubiquitous now. By no means do you need Wepay to survive.

Re: In Urban China, Cash Is Rapidly Becoming Obsolete

#140

Post by sangnoir »

seanmcdirmid wrote: post #131
nickrio wrote: post #54

Earlier quoted context omitted.

I'm a Chinese & living China, I shopping almost only with credit cards and cash for privacy consideration. However, I don't think credit cards in China are as popular as it is in the USA. I could guess most Chinese people don't have any credit card. Chinese traditional culture encourages saving, not loaning. And taking small loans is exactly how credit cards works. So maybe that's why people here don't like credit ca…

I think most people pay their balance off every month in the USA. Credit card doesn't mean borrowing. The big problem with credit cards in China is fraud: banks like ICBC will put the burden of proof on the card holder when a fraud transaction occurs, rather than the merchant as in the west. I really hate ICBC. Anyways, debit cards work just like QR pay does, just like UnionPay already does. The problem QR codes are…

> Many countries have an even better technology in NFC contact

NFC isn't "better technology", just different to QR code. NFC also handles 1 payer at a time whereas QR can handle multiple, in parallel depending on the physical display size.

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