WeChat Payment. Why Chinese payment system is beginning to interest Russian retailers

Just a couple of months ago, the WeChat Payment system was launched in Russia, but most of the publications devoted to retail, only casually told about one of the most popular social networks in China and the world. If we turn to the history of the formation of WeChat, full of major achievements and innovations, we can find that the system has contributed to the development of Chinese retail. Today we will talk about the main features of the social network WeChat, the role of WeChat Payment technologies in the development of retail and the prospects of the Chinese payment system in Russia.

Launched in 2011 by the leader of Chinese Internet technologies, Tencent, a free social network WeChat in just a few years gathered more than 400 million users worldwide. To date, the number of WeChat users has grown to 1 billion people. Note that the application is very popular not only in mainland China, but also in Japan, Korea, and the countries of Southeast and South Asia.

Imagine a mobile application that combines the functions and advantages of Facebook, WhatsApp and Twitter — WeChat is famous for such a wide range of possibilities. Communicating with friends and family through text, audio or video messages, reading the news feed, publishing your own news, articles, comments, and finally, money transfers and payment system — this is why WeChat takes an important place in the life of the modern Chinese, thereby virtualizing society of the PRC.

WeChat Payment is a digital wallet service built into every WeChat user account that allows you to make mobile payments in stores and send money between contacts. Users can recharge by linking their WeChat account with their debit card or receiving transfers from other contacts. Users who link their credit card to an account can only make payments in stores, it is impossible to replenish the balance.

The magic of «red envelopes»

In the early years of social networking, no more than 30 million people contacted WeChat Pay. But in 2014, the number of users actively using WeChat Pay increased to 100 million people. — this rapid growth has provided a new opportunity for WeChat.

In the Chinese New Year, users of the mobile application have the opportunity to send family members and friends “red envelopes” (红包) — a traditional Chinese ritual that came from antiquity, when one of the main gifts for the Spring Festival (and today for the wedding and other celebrations ) served a red envelope in which money was put.

In the «red envelopes» WeChat users put an arbitrary amount withdrawn from the balance WeChat Pay. These envelopes can be personalized, that is, the user sends an envelope to a friend, he opens it and receives the entire amount in his wallet, and can be auctioned when the envelope is sent to a group chat with a total amount, and that user who opens the gift first receives all the money. an envelope (this common game among young people is called “rob a red envelope” 抢 红包).

Красный конверт

The function of the «red envelope», by the way, perfectly demonstrates how WeChat is being introduced into the personal life of the Chinese by appealing to their beloved and respected all traditions.

“Red envelopes”, according to Ma Yun (马云), the founder of Alipay — the main competitor of WeChat Pay, became a kind of “Pearl Harbor moment” when the online payment market was managed by a new player. Soon Alipay and other mastodons of the Chinese Internet industry (Baidu Wallet and Sina Weibo) also began to introduce the function of «red envelopes». It is worth noting that all the major representatives of this industry are not independent payment systems, representing projects of the largest Internet companies and retailers.

In 2016, WeChat began charging a service charge when withdrawing funds from a wallet. Each user has a free withdrawal limit per 1,000 yuan (about 10,000 rubles). Further withdrawals required a fee of 0.1 percent with a minimum of 0.1 yuan for withdrawals. Other payment functions, including red envelopes and transfers, are still free. Despite the commission, the growth of users of the application only increased.

WeChat Applets — The New Face of Chinese Retail

In January 2018, Tencent Executive Vice President Zhang Xiao-long (张小龙) said that today We WeChat Pay is focused on developing a system of applets (APIs) — stand-alone mini-programs that any WeChat users can create. According to the China WeChat Economic and Social Impact Study, officially released by the China Institute of Information and Communications Technology, by the beginning of 2018, 95% of Chinese e-commerce platforms were connected to the API system. That is, almost every Chinese store creates its own applets, through which WeChat Pay payments pass. Also, applets contain advertising for these stores, take into account the preferences of each user-buyer, based on his search queries, purchase history, etc.

By the beginning of 2018, 580,000 applets were created in WeChat, covering more than one million developers and 2,300 third-party platforms. According to Zhang Xiao-lung, applets are fundamentally changing the rules of Chinese retail. From the traditional centralized system, Chinese trade is gradually moving to a decentralized, but the main task of WeChat and all Chinese electronic payments is to achieve a distributed control system.

A little explain the terminology. The concepts of a centralized, decentralized and distributed system in this case cover the possibilities of buying and paying for goods within the framework of WeChat Payment. So, in a centralized system, stores have connections to the WeChat Pay payment system, but all operations go through the main application servers, and payment is made either directly at the store or by direct transfer of money to the merchant account. The decentralized system requires the stores to create their own applets, by which the load on the main servers is reduced and the buying process is accelerated, the payment is made in the applet itself, and each store has its own assortment in WeChat mini-programs, enabling users to buy the necessary goods without leaving the social network. However, the decentralized system still contains signs of centralized — when not all stores have personal applets and purchases are made old by direct transfer of funds from an online wallet. The ideal of a distributed system, based on the ideas of Zhang Xiao-lung, is the formation of a market based on applets with the most effective advertising, instant payment and prompt delivery, when the user makes almost all purchases online, and when any seller of goods or services can independently create a mini-program in WeChat for trading.

 Схема развития системы электронных платежей

The scheme of development of electronic payments

The road to an extensive system is laid out by a number of signs of the new information society: 1) the notion of “offline” disappears — every Chinese uses WeChat, which means it is always connected to the network; 2) the need to visit stores in the conditions of a developed delivery system is lost, thanks to universal payment methods and new advertising opportunities; 3) Applets reduce the load on WeChat servers, thereby speeding up the payment process. Hence, according to Zhang Xiao-long, the era of smart retailing begins, in which the “bricks” of the classic retail pyramid — the person, the product, and the market — are replaced by digital data and Internet traffic.

The scale of WeChat Pay in China and the world

Today, arriving in any city in China, we can see a similar picture: somewhere in the corner of the counter, the POS terminal, which is familiar to our eye, is gathering dust, and all Chinese, young and old, pay for their goods or services to their smartphones. prints of a QR code that, like emblems, adorn every store. WeChat Pay literally infiltrated every public place in modern China. Not to mention large supermarkets and brand clothing stores, services.

WeChat Pay is used in the markets, in taxis, in museums and even temples (when buying souvenirs, etc.). Cash is rarely used, cards are even rarer. Chinese taxi drivers, by the way, often do not even accept cash, preferring only online transfers.

According to the WeChat Data Report reports, in 2017 the growth of WeChat Payment users among young people increased by 97.3% (up to 18 years), and among elderly (over 60 years old) — by 46.7%. Considering that 2017 is recognized in the report as the first year when smartphones appeared on all age groups, this growth is very impressive.

Масштабы WeChat Pay в Китае и мире

WeChat Pay is also gaining popularity in Western Europe and the USA. Last year, Western Union brought global money transfers to the forefront, giving WeChat users in the United States the opportunity to distribute funds in 200 countries and territories through a messaging service. WeChat Pay payment service is also available worldwide for outlets equipped with Vexilor POS systems, thereby competing in the western market with Apple Pay and Android Pay.

In recent years, WeChat Pay has been actively fighting for the international brand market, trying to facilitate business by facilitating online customer service. This problem is noted by Louis Wong, manager of the well-known international brand apparel network Makin Jan Ma: “To open a WeChat store, you need to spend time on online customer service. You need to regularly update information, which takes a lot of time. »

Of course, WeChat Pay is still inferior to Apple Pay and other Western payment aggregates in online payments abroad, since the application is mainly aimed only at Chinese tourists, but if we compare the number of mobile payment users in China and Europe and the USA, the obvious leader will be it is China.

Nevertheless, WeChat Pay continues to evolve at leaps and bounds, changing the face of retailers not only in China, but in the whole world.

So, in June of this year, WeChat Pay earned in Russia. The ended World Cup and the ongoing Chinese tourist season have already brought a lot of revenue to Russian stores. The first Russian Amber stores in St. Petersburg began to receive payments on WeChat Pay, in early July, the Central Department Store and GUM were connected to the payment system. One should not be surprised at such a selective connection: one of the most profitable enterprises of the Chinese in Russia is buying amber and selling it in China. This confirms the fact that most of the Chinese tourist programs in Moscow and St. Petersburg include a mandatory visit to amber shops. A large number of Chinese sellers who are filled with a shopping center can tell about the popularity of TsUM. It is worth expecting that soon WeChat Pay will work in the popular stores of watches and souvenirs, which is also a frequent place of the “pilgrimage” of PRC tourists.

We should not forget that at the beginning of this year, the payment system WeChat, Alipay, started operating in a number of retail chains in Russia. “Dixie”, “Lenta”, “Burger King” — in this case, the Chinese payment systems are aimed not only at the tourist, but also at the Chinese invited workers and students. It is quite possible that domestic supermarkets and catering places, so popular among Chinese living in Russia, will also connect to the equally well-known WeChat Pay.

In early June, we already reported that WeChat Pay was launched in Russia. At that time, only Chinese citizens could pay for purchases using the new service.

In addition, last year, the French trading corporation Auchan confirmed the information about the opening of a network of self-service stores Auchan Minute in major cities of China. To enter the store, customers only need to scan the QR code through the WeChat application.

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