A recent news article reported that Hong Kong shoppers may soon be able to use the Hong Kong version of a major social media and chat platform that recently launched a payment version on its phone, payment app to pay for purchases at mainland merchants, according to people familiar with the matter.
The feature will be announced at a press event for the app in Shenzhen today (26 September 2018), according to people familiar with the matter, who declined to be named as the information is private. A representative for the Chinese internet giant, which operates the app, declined to comment.
The details were first reported on Hong Kong tech website before the information was taken down, according to a news source.
The chat app with the payment option in Hong Kong, an e-wallet, was previously only available locally in the city and was not accepted as a form of payment by mainland merchants as the payment systems used are different in each jurisdiction and not interoperable.
The service will make the multinational investment holding conglomerate the first Chinese company that allows Hong Kong users to settle their purchases on the mainland via a Hong Kong mobile payment wallet.
A local mobile payments partner affiliated with another major Chinese multinational conglomerate specializing in e-commerce, retail, Internet, AI and technology, which is backed by an affiliate company the same group, has not yet announced a similar feature although the company has previously said it was exploring similar solutions for the mainland, as well as for other countries and regions.
Mainland users of the e-payment app, as well as its rival, have for several years been able to make payments at selected merchants with their Chinese mobile wallets when travelling abroad. Such payment methods are commonly accepted at luxury stores in Europe and at popular tourist attractions, where payments for overseas purchases will be settled in yuan.
Both the e-payment apps have raced to have their respective wallets accepted as a payment method around the world to cater to China’s hundreds of millions of outbound tourists, who last year spent HK$2 trillion (US$258 billion) abroad, making them the biggest spenders globally, according to the United Nations World Tourism Organisation World Tourism Barometer.
Encouraging these e-wallets and apps as payment options outside China can help drive transaction volumes since users are more likely to use payment methods familiar to them for convenience. The ticket size of each transaction is also likely to be larger when users are travelling abroad.
Earlier this year, a report made the case that Hong Kong must push for more e-payment.
It was noted that almost anyone with a smartphone can and will use it because this payment method is straightforward and cheap. Users around the city-state that e-payment is so convenient and easy to use that in China even roadside food stall operators have adopted it.
The money in the transaction can be small, often less than 100 yuan (US$16).
For vendors, the large volume of transactions and the low costs involved make sense. The consumers do not need to be tech-savvy to use it and do not need to carry cash.
Now that not one, but two, major e-payment options have made their way onto the scene in less than 6 months is commendable and a good sign that Hong Kong is committed to rolling out its Smarty City Blueprint as soon as possible.
