Home visit blown away Part I - mobile money

It has been two and half years since the last time I visited home China, and like each and every time before, I was blown away by the changes.

This time it is not about new commercial development projects or infrastructure development of urban expansion, it is about the great convenience that comes to the lives of millions of urban dwellers. Firstly, mobile money, few people carry cash with them anymore. People pay the merchants, return money to friends, buying products online all using one of the two online payment methods: Alipay, or WeChat.

Alipay, owned by Alibaba, the biggest e-commerce company in Asia with revenue over a hundred billion in 2016, three quarters of what Amazon made the same year, expanded their business in online payment industry, a natural move. While WeChat is a social media application developed by Tencent. It started off as a social media platform with instant messaging, but later expanded into e-commerce and payment services. In January 2014, during the Chinese new year, WeChat developed the mobile application WeChat red envelope which allowed family members to send money online to each other through WeChat platform. It is the perfect mix between technology and tradition - sending red envelope that encloses money during the New Year festival, via your smart phone. When these “dummy but real” money sit in your e-wallet for too long, you long to spend them in the real world, and this is how WeChat pay started.

But mobile money is not a new topic, it never is. 3 years ago when I first experienced M-Pesa in Kenya, I was blown away. How come such convenient mobile money transfer services did not exist in China nor North America at that time?…It turns out, technology was not the barrier, it rarely is. Be it near field communication (NFC) or chip reader, there are far more fancy technologies out there in the fintech world than needed. M-Pesa uses PIN-secured SMS text messages, Alipay and WeChat uses QR code, while Apple Pay, Android Pay, and Samsung Pay shared NFC payment methods.

If technologies are not a problem, then what is? I am guessing politics is the main reason, like it is to many other things.