Global card linkage will help users, merchants

A recent decision by WeChat Pay and Alipay to fully open up their online payment services to international card organizations such as Mastercard, Visa, JCB and Discover Global Network will offer greater convenience to global users in mobile payments and enable millions of small merchants to tap overseas purchases, industry experts have said.

The move helps foreign users in making mobile transactions in China by linking their international cards to pay for dining, transportation, shopping, hotel accommodation and more throughout the country.

Both WeChat Pay and Alipay opened links with international cards in 2019 but these could be used only in limited scenarios until now.

In July, WeChat Pay introduced several preferential policies to enhance the payment experience of international tourists, such as exempting transaction fees for payments less than 200 yuan ($27.85).

"China's mobile payment has leapfrogged to become the dominant payment method in the country in recent years, while most people in foreign countries still adopt traditional payment methods like bank cards," said Zhao Xijun, a finance professor at the Renmin University of China in Beijing.

Zhao said foreigners who did not possess a Chinese bank card had to use international credit cards in the country.

"Thus, the move will greatly empower international travelers to enjoy the same convenience of mobile payments as Chinese residents," he said.

A report by the People's Bank of China, the country's central bank, showed that noncash payments via bank cards, electronic payment vehicles, commercial paper, credit transfers and other settlements, hit 4,805 trillion yuan last year, up 8.84 percent year-on-year.

"The shift toward enhancing mobile payment options for international users in China is a significant step forward," said Luigi Gambardella, president of ChinaEU, an international association promoting digital and high-tech cooperation between Europe and China. "It will also benefit Chinese merchants who do not accept foreign credit cards or try to avoid them and will now likely increase their sales to foreigners in the country."

The move will, to some extent, enable millions of merchants across China, especially small and medium-sized enterprises, to tap into the bigger purchasing power of international buyers, he said.

As China is hosting various international events this year, such as the ongoing Chengdu FISU World University Games and the Hangzhou Asian Games starting in September, the number of inbound visitors is expected to rise.

"The transformation not only benefits individual travelers and merchants, but also strengthens China's position as a world leader in the adoption of mobile payments and a major contributor to global advancement in fintech," Gambardella said.

Chinese authorities, including the National Development and Reform Commission, the country's top economic regulator, have encouraged companies to refine mobile payment solutions for overseas visitors.