China’s new mobile payment methods

More than two thirds of Chinese consumers have used mobile payment for their purchases, according to a survey from SAP. However, if one’s knowledge of mobile payment is confined only to scanning QR code via WeChat or Alipay on mobile phones, one probably has to take a crash course on it. Nowadays, Paypal and Square are both able to settle payments by just putting in the payer’s name, the former via Bluetooth Low Energy and the latter, GPS.

There’s even more to come in mobile payment. Recently Square launched an authentication-free email payment system, where the user can simply send the money by writing the recipient an email, typing the amount in the subject line and cc’ing it to cash@square.com. In China, this function now has a SMS equivalent. Shanda has officially released Youni, a type of software that enables transfer of money among individuals via text message. Due to the heated security issue surrounding the Square’s email payment function, as email accounts can be hacked to transfer money to the attacker, it still remains a tough question how users can be convinced of the security in SMS remittance.
On the other hand, Alipay has also risen to the challenge against Wechat’s huge user base. On October 16th, Alipay released an update featuring a close-range sound wave payment system without internet access. It is said that the payment is made through a vocal print sent from the payer’s mobile phone encrypting bank card information. But this technology still has its flaws such as weak security and slow payment process. Whether this payment mode will gain popularity still remains to be proven.

Although the latest payment technologies are deeply flawed in security, other widely used payment methods aren’t much better. Recently WeChat Payment and Alipay have engaged in a war of words over security issues. No sooner had Fan Zhiming, president of Alipay, blamed Tenpay failures on QQ and WeChat account thefts due to weak security mechanism, than the WeChat Payment offered users a full compensation solution, promising a full refund for any loss caused by WeChat Payment failures.

The field of mobile payment is becoming dominated by those two giants. However, as new technologies, apart from security and convenience, play an increasingly crucial role in gaining the upper hand in the competition, WeChat seems lagging behind.