Chinese tech giant Tencent and Visa have announced a strategic collaboration to offer e-wallet services to international credit card users by allowing their cards on Chinese e-wallet platform WeChat Pay.
WeChat by Tencent is the Chinese equivalent of WhatsApp and WeChat Pay is their e-wallet service. Over 141 million tourists visit China annually. From the US alone an estimated 8000 people visit China daily. Until now an international consumer had to open up a bank account and secure credit cards issued in mainland China for transactions using WeChat Pay.
What Will This Mean?
With more international visitors arriving in China for business, various financial institutions are revising their policies. For instance, WeChat Pay in its pilot phase will equip worldwide credit card holders to buy train tickets and pay for Didi Chuxing, a Chinese ride-hailing service provider.
“In a truly global commerce environment, collaboration is essential to provide consumers with a seamless payments experience. Visa is excited to work with Tencent, one of China’s leading FinTech companies, on a secure, convenient and interoperable mobile payment experience that will benefit a large number of international travellers visiting China,” Visa said in a statement.
Cities like Detroit have a large number of businessmen and professionals traveling to mainland China. Apart from these are visitors from economies like South Korea, Japan, India, Germany, and Canada.
How Does WeChat Pay Work?
In China, users can provide bank account information and use WeChat Pay to pay bills, order goods and services, transfer money to other users. Though users receive notification soon after the transaction, the WeChat Pay system is not an instant payment platform. The settlement time depends on the payment method chosen by the customer and a credit card settlement takes slightly more time.
Non-Chinese users of WeChat Pay has to undergo an additional identity verification process of providing a photo of a valid ID. Certain functions of WeChat Pay were inaccessible. Until now users who link their credit card could only make certain payments and could not top up WeChat balance. WeChat Pay had over 300 million users worldwide.