No cash, no prob­lem

Ex­pa­tri­ates laud China’s mo­bile pay­ment in­dus­try

China Daily (USA) - - FRONT PAGE - ByWANG YING in Shang­hai wang_y­ing@chi­nadaily.com.cn

ThomasDerk­sen, a so­cial me­dia star­known ar­known for post­ing fun videos that sat­i­rizes ev­ery­day life in Shang­hai, was re­cently givenn a chal­lenge chalthe of spend­ing a day in­Hangzhou, the cap­i­tal capiy of Zhe­jiang province, with­out any cash or credit cards on hand.

TheGer­man ex­pa­tri­ate, who lives in Shanghe Shang­hai, ad­mit­ted that it was some­thing he could not imag­ine do­ing back home in Europe, rope, but he breezed through the chal­lenge us­ings­ing only his smart­phone, which was in­stalled led with Ali­pay, the third-party pay­ment app.

Derk­sen, who has been af­fec­tion­ate­lytely nicks nick­named A Fu by ne­ti­zens, started his cash­less day at Hangzhou East Rail­way Sta­tion,on, where he man­aged to rent an um­brella andd a por­ta­can­ning­portable bat­tery for his phone sim­ply by scan­ning a QR code and com­plet­ing the trans­ac­tion tion with Ali­pay.

He then went on to per­form manyany other trans­ac­tions through­out the day, in­clud­ingn­clud­ing tak­ing a bus, get­ting a bou­quet of flow­ers ow­ers for his wife and even buy­ing a street snack, ack, all of which were cap­tured on video.

At the end of the chal­lenge, Derk­sen­wasvis­i­blyn­wasvisce as­tounded by the abun­dance of mo­bile pay­ment op­tions in Hangzhou,ou, the host city of the G20 Lead­ers Sum­mit- on Sept 4 and 5.

“It is un­be­liev­able that I can even buy street snacks with Ali­pay in Hangzhou,” he ex­claimed.

“To be hon­est, I dare not go out ut with­out cash even in Frank­furt, Ger­many. er­i­ties Among the sev­eral hun­dred cities in more than 30 coun­tries I’ve vis­ited, Hangzhou is truly the cap­i­tal of mo­bile obile pay­ment.” payd

Chi­nese ne­ti­zens may be amused by the Ger­man’s re­ac­tion. Af­ter all, the cash­less less trend is fast catch­ing on across China, es­pe­cially in Hangzhou, wher­e­morethan 95 per­cent of taxis, su­per­mar­kets and con­ve­nience stores ac­cept Ali­pay.

In ad­di­tion, more than half of the 40,000 or so restau­rants in the east­ern Chi­nese city, as well as var­i­ous leisure and en­ter­tain­ment venues such as hair sa­lons and karaoke lounges, ac­cept this mode of pay­ment.

Ac­cord­ing to the Dig­i­tal In­clu­sive Fi­nan­cial Index, which is com­piled byPek­ingUniver­sity, Hangzhou is the top Chi­nese city in terms of mo­bile pay­ment, credit fields, fi­nan­cial man­age­ment, in­vest­ment and in­sur­ance. The index sur­veyed 337 cities be­tween 2011 and 2015.

When asked if he would rather carry 10,000 yuan ($1,500) in cash or rely on a smart­phone, Derk­sen was quick to pick the lat­ter, al­though he con­ceded that most of his com­pa­tri­ots may not nec­es­sar­ily agree with him.

Derk­sen, who was born in Marien­heide, a mu­nic­i­pal­ity near Cologne, said thatGer­mans are by com­par­i­son rel­a­tively skep­ti­cal of us­ing mo­bile pay­ments meth­ods. In­stead, they pre­fer to use cash and debit cards.

“I used to work at Ger­man bank Sparkasse and I found it ex­tremely dif­fi­cult to per­suade peo­ple to use credit pay­ments in their daily lives. Ger­man peo­ple are un­will­ing to take risks, and they don’t want to make any changes in their lives.”

Derk­sen said his ex­pe­ri­ence at the bank taught him that there is no such thing as ab­so­lute se­cu­rity when it comes to money mat­ters.

“Tra­di­tion­ally, peo­ple think banks are the safest place to save their money, and that it is risky to try a new pay­ment method. But when I started work­ing at the bank in 2008, I dis­cov­ered that banks were the first to suf­fer from the sub­prime mort­gage cri­sis,” he said.

Derk­sen praised the de­sign­ers of Ali­pay for be­ing “smart and con­sid­er­ate”, say­ing that al­though the in­tu­itive app al­lows user­sto eas­ily make pay­ments, it also has robust se­cu­rity fea­tures in­clud­ing fin­ger­print or fa­cial recog­ni­tion.

“I re­ally want to show this Chi­nese mo­bile pay­ment tech­nol­ogy to my par­ents and my friends in Ger­many,” he said.

“Ger­man Chan­cel­lor An­ge­laMerkel is com­ing to Hangzhou for the G20 Sum­mit, and I re­ally hope she can see how ad­vanced China is in mo­bile pay­ment tech­nol­ogy. I think many coun­tries can learn a lot from China in this sec­tor.”

A report by Ali­pay showed that the most pop­u­lar func­tion uti­lized by for­eign users like Derk­sen is money trans­fers, with up to 79 per­cent of th­ese users hav­ing per­formed such a trans­ac­tion. Other pop­u­lar func­tions in­clude recharg­ing cell­phone credit (33 per­cent), and pay­ment of taxi fares (18.5 per­cent) and util­ity bills (10 per­cent).

Mean­while, 32.3 per­cent of Ali­pay users have pur­chased ac­count safety in­sur­ance, in­di­cat­ing that the ma­jor­ity of for­eign users seem con­fi­dent of the se­cu­rity the app af­fords.

Ac­cord­ing to Ant Fi­nan­cial, the op­er­a­tor of Ali­pay, us­age among ex­pa­tri­ates on the Chi­nese main­land this year has in­creased con­sid­er­ably on 2015. It noted that nearly 30 per­cent of ex­pats are Ali­pay users, and that al­most 40 per­cent of for­eign users have used Koubei, an on­line-to-off­line plat­form also op­er­ated by Ant Fi­nan­cial.

An­tFi­nan­cial isas­ub­sidiaryof in­ter­net gi­ant Alibaba, which is head­quar­tered in­Hangzhou. Apart from Ali­pay, the com­pany also runs fund man­age­ment plat­form Yu’ebao, third-party fi­nan­cial ser­vices plat­form Zhao­caibao, pri­vate on­line bank My­bank, mi­croloan provider Ant Mi­cro Loan and Sesame Credit, the na­tion’s first pri­vate credit-rat­ing sys­tem.

Chris Pow­ers, an ex­pa­tri­ate from the United States who lives in Shang­hai, said he of­ten leaves home with­out any cash in his pock­ets th­ese days, thanks to the con­ve­nience that mo­bile pay­ment ap­pli­ca­tions like Ali­pay af­ford. He added that many of his Amer­i­can friends in the city of Hangzhou also fre­quently use the app.

“I’ve been able to get through stretches of three to four days in Shang­hai us­ing no cash at all. I can pay for cabs, food or­ders, su­per­mar­ket pur­chases and drinks at bars as long as I have my mo­bile phone,” said Pow­ers, who started to use Ali­pay about a year ago.

Sel­wyn Low, a Sin­ga­porean who works at a multi­na­tional ad­ver­tis­ing agency in Shang­hai, said he uses the mo­bile pay­ment app al­most ev­ery day. “It’s so con­ve­nient to use a

Thomas Derk­sen, a Ger­man so­cial me­dia star in China

mo­bile phone to pay my util­ity bills. I no longer need to open en­velopes to check my bill,” he said.

Low, who started us­ing Ali­pay about two years ago when he lived in Beijing, added that his life in China has be­come much eas­ier with the pro­lif­er­a­tion of mo­bile pay­ment ap­pli­ca­tions. “Sin­ga­pore is pretty modern, but the cash­less scene back home is still in its in­fancy com­pared with China. I’m very im­pressed that I’m able to do so much with my mo­bile phone in China. It’s re­ally noth­ing like I’ve ever ex­pe­ri­enced.”

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