Why Are Mobile Payments So Popular In China?
Due to the advancement in technologies, the world is fast moving towards the digital space. You can observe transactions and interactions of all sorts being carried out online. There are plenty of websites and mobile applications that are providing online apparel shopping, grocery shopping, sites for financial investments, learning through online portals, and various other aspects of our lives. Nowadays, people do not even require a desktop or a laptop for getting their work done as they have smartphones in their hands. Thanks to the expansion of the smartphone market, both in terms of sales and mobile technology, online payment systems have also surged. Earlier, people were a bit skeptical while making use of the online payment portals as they were not very secure. Moreover, payments could be done mainly through computers as phones were not compatible with most payment systems. But today, where everything is encrypted, the payment process has also become very safe and secure. According to a survey that was conducted in developed and developing countries, it was observed that the popularity of mobile payments in China is at its peak and is still increasing. They have left the US behind and have become the number one in using the mobile payment service. Now the thing to understand here is why is it so?
Let us understand the reasons behind this popularity in mobile payment services.
#1 The Increase In Reliability And Trust In Mobile Payment Services:
Generally, when a service is not as functional as expected for the people/customers, the first and foremost thing that gets affected is trust. With the improvement in mobile payment services, they have become more reliable, safe, and secure. Due to this, an increasing number of people are making use of mobile payment services for all their large and small purchases. The people of China have complete trust that financial matters such as online transactions are handled with care. Moreover, the businesses are also looking forward to online payments, as “Cash On Delivery” is not a suitable option for many of them. By making the switch to mobile payment services, not just the customer feels comfortable and secure, but even the businesses are finding it beneficial.
#2 The Big Business Players Are Promoting Online Payment:
Another important reason due to which the mobile payment services in China are increasing at a faster speed is the participation of the big players. These big players are Alipay, and WeChat Pay. These two major business groups are supporting a wide range of e-commerce businesses to make their payment system more safe and secure. For instance, Alipay is the payment system that belongs to Alibaba Group, and they are extending support to the e-commerce platforms in the form of Tmall and Taobao. The major business groups always have clients and customers of their own who are encouraged to use the mobile payment system to increase the convenience and reliability of the businesses.
#3 China Is Focusing On Developing Mobile-First Society For The People Of China:
This is another great initiative undertaken by the Chinese government to encourage the use of mobile payment rather than depending on the “cash-based” services. If you observe the statistics, you would get to know that almost 600 to 650 million users are using smartphones and mobile payment services even for important large volume transactions. Moreover, the experts claim that there has been an increase in mobile payment services as smartphones are becoming more and more affordable. Thus a greater proportion of the Chinese population is able to purchase smartphones and thus easily opt for mobile payments.
#4 The Introduction Of The Red Packet-In China:
Have you heard of Red Packet? It is yet another essential innovation that has played a significant role in increasing the popularity of mobile payments in China. The red packet was introduced in China by WeChat in the year 2014 (which is almost 7 years ago). The Red packet is a way for users to give each other money as gifts. The gift is in the form of credit in the recipient's WeChat account and can be used to make purchases later. This feature led to the doubling of the market share of WeChat and a growing reliance on mobile payments.
Summary:
Although mobile payment has increased in popularity in all the countries, China is leading the game right now and this is due to the factors explained above. If you are providing a safe and secure method of payment to the customers, if you are increasing the convenience for the businesses and clients, the use of mobile payment will definitely increase.