Trend Report China
Do the Chinese spend more money because of digitization?
It does not matter if you go shopping, use bike sharing, register in hospitals or pay your electricity bill, in today´s China you can pay with the mobile phone in almost every area of life. According to a survey by the “Beijing Youth Daily”, more than 70% of respondents said that cash is not a necessity in their everyday life. According to another survey targeting Chinese internet users, 40% of respondents have less than 100 RMB in their purse, 14% said they do not carry cash at all.
The Chinese survey company iResearch shows that China’s mobile payment reached 58.8 trillion Yuan (excluding banking services) in 2016, about 5 times more than the previous year. The reason for the popularity of mobile payment is not only the slow spread of credit card coverage in China, but the Chinese government shows great tolerance to the development of financial services by internet companies (Alibaba, Tencent etc.).
One can see the power of digitization in every corner of Chinese life. Even small mom-and-pop shops accept mobile payment as long as an RQ code can be generated. Recently, even individual sellers in the vegetable markets of China have begun to offer mobile payment as well. It has already become a new habit that “lucky money” is sent in virtual red envelopes to friends and relatives during the holidays. Some people complain that many restaurants and small supermarkets no longer accept cash because money is already too time-consuming for them!
Experts say that the expansion of mobile payment services has increased consumption significantly, especially in food / beverage delivery. Before, many people went to the store once a day to get daily necessities, but now they are ordering several times a day. In fact, food and beverage consumption has been growing since the second half of 2016. According to China Internet Information Center, compared to the end of 2016 the APP users for online-ordering of food / drinks at the end of June 2017 rose by 41%. The total number of users reached 300 million.