U.S. Banks Are Terrified of Chinese Payment Apps


In China, people use mobile services owned
by Alibaba and Tencent to do almost everything. They chat, shop, send money to each other,
and even make purchases in physical stores. And the country is becoming cashless. So here’s the scary thing for American finance
executives — the banks never get a cut. In fact, many Chinese don’t even have bank
accounts. China is among the growing number of countries
showing that payments can happen cheaply and easily without banks or credit cards. In contrast, U.S. consumers still rely on
banks for most of their purchases. Even mobile payments made through apps like
Apple Pay, Uber, or Venmo, are tied to the users cards or bank accounts. That all adds up to a feast of fees for many of the companies that handle and process payments. For a typical $100 credit card purchase in
the U.S., $97.25 goes to the merchant and the rest is split between issuing banks, payment
processors, the merchant’s bank and card networks. Those small slices add up to billions of dollars
for banks every year. If apps were to grab market share in the U.S.
at roughly the same rate as they have in China, banks would lose a projected $43 billion in
revenue from one of their most profitable businesses. And that’s not the end of it. Banks also generate revenue by dispensing
cash and administering checking accounts. If payment apps were to replace paper money
and offer alternatives to regular bank accounts — as they increasingly have in China — other
sources of income could take a hit. Checking accounts alone generate $3 billion
in bank fees in the U.S. Whether you have access to a bank or not,
being able to make or receive payments through your phone is an obvious advantage — as
Alipay and WeChat Pay have demonstrated in China. And that’s the challenge facing traditional
banks, as the evolution of mobile payment systems gains momentum.

100 Replies to “U.S. Banks Are Terrified of Chinese Payment Apps

  1. Stop at 0:20 for wait a minute! wow man! Have you ever used alipay or weichatpay before?? If you don't have a bank account you will not be allowed even to receive money, not to mention transfer money! ok? The truth is when people use services like alipay or weichatpay you have to register your bank account to your service account, then for every transaction you make, there are processes goes on like you mentioned at 1:00, only with percentage difference. Another thing is EVERY CHINESE have at least one bank account or more, as far as I know! Because I have lived in China for over 30 years.

  2. This is unethical. They need to separate these services and in the even they do a combined service they should declare the ethics of the specific field.

  3. The money in the digital accounts still come from bank accounts, and most of the Chinese people still save their money mainly in the bank accounts, please do research before covering.

  4. Media like Bloomberg states it’s negative opinion at very beginning when presented an inaccurate country map.

  5. “Digital Only” currency is a recipe for disaster. Imagine the government simply erasing all your savings if a day something the government didn’t like. Maybe cyber thief could crush their entire economy by deleting any and all records of savings from people leaving the country to riot and chaos

  6. The USA is way behind Europe as well. To work with checks (UK: cheques) has become so antiquated elsewhere that in my country young people think you are talking about another century if you say that Americans pay by check. Also, Americans won't give you their bank account so that you cannot transfer money to them or their companies. "Send a check" or "Use your credit card" I am told. The only positive thing about that is that it gave us Elon Musk. He earned $300 million by providing electronic payment services that were a bit more modern, PayPal.

  7. Wechat pay relies on wechat, the social media, Alipay relies on taobao, Chinese Amazon. So, where is amazon pay and facebook pay? Or are we thinking about Apple credit card?

  8. Is this propaganda or straight up lie? All banks print money out of thin air. "Bitcoin",gold,silver is money

  9. its not all true,in china ,if u want to charge money to ur alipay or wechat account, u must have a bank account. otherwise, you only have to ask ur friend to send money to u personnally

  10. Trump: Chinese steals online payment technologies from USA.
    Trudeau: Do not worry, I am going to kidnap Jack Ma

  11. Most likely one of the reasons for current American trade war.

    Bank lobbies crying in Washington:
    Mr President do you see what's coming, if we don't stop China now world will see they don't need Banks and how will we then operate our cartel without being able to squeeze those sweet trillions out out people's accounts

  12. guys its true that Alipay and WeChat pay is acquired by the Chinese government Ministry of Commerce – the company just runs it

  13. Payments are linked to your bank account. In china, you specifically will need a Chinese bank account. The losers will be credit card company as nobody will need to use them unless they have a habit of spending money they don't have yet. Oh wait, never mind.

  14. But that would mean price cuts on items we purchase everyday, as there wouldn’t be any processing fees.

  15. The US cannot ban it. It’s inevitable. China is expanding Alipay and Wechat Pay to all Asian countries and developing countries who need the system or want the tourists money. 3 million Chinese visitors to US a year plus average 5% Chinese students in US universities all willing and able to give away some money. People will be begging for more. Like gold coins and cash, plastics will disappear unknown to the next generation.

  16. No. Actually, Alipay and WeChat Pay both require you to associate your bank card to their app. Banks and payment processing companies do get cuts from these mobile payments.

  17. Currently, PayPal and cashapp (Square) are offering router and account #’s to receive employment direct deposit. Bye bye banks.

  18. But will the same american public be happy with the power that the likes Alibaba have? They are already crying about size and influence of likes of amazon, facebook etc.

  19. if AliPay and WeChatPay don't need bank accounts, then what institution does hold money ? have they banking license ?

  20. We have mpesa a money transfer app on the phone. At first some banks rejected it now they have accepted it. Almost every adult has mpesa and u can pay for groceries and all with it.

  21. Alipay and Wechat wallet are also tied to the user's bank account: credit card or debit card. It's basically the same thing.

  22. Wait… I might have missed part of the video, why would US banks be afraid? I mean alipay or wechat pay isn't coming to American market, at least not in us dollars. If the two company ever poses any threat, just ban them. You know, declare them as national security concern or something.

  23. I have been using alipay and wepay for a month and It's so practical, you show the product, they scan it, you show your hone with the barcode, they scan it, you leave, it takes five seconds, way more practical than using credit cards.

  24. as a foreign first you need a phone number to get a wechat or alibaba ,then you need a friend who can give you some “红包“or ”零钱” by wechat or alibaba and you give your friends maney in cash

  25. If Chinese people see anything US is succeeding, they are eager copy and refine it. Alipay and wechat pay are copycat of PayPal. But when something better of for majority is succeeding in China, American companies wouldn't get a chance because intense political conflict. It is ridiculous sometimes simple gender equality//without mentioning LGBT// or fund for 911 first responders could be blocked. If you hate this situation please vote for the candidate that could bring cooperation to this country. Not anyone in 2020 so far. If we are in serious emergency our politicians would never bash each other daily.

  26. 草泥马,美国媒体。擅自割让中国领土

  27. Banks are the devil incarnate. I hate them and also fear the government tracking me via every purchase I make. Cash is King.

  28. This is not true — Alipay will still need to connect to a bank account – it works like a debit card.

  29. Which is why the Congresspeople owned by the banks are fighting so hard against Facebook coming out with their version of this. Not that I'm eager to see a company known for privacy violations getting even more information about their users. But let's me clear why Congress is against it. It never has anything to do with what is in the best interests of the citizenry. It is 100% about what serves the banks. Any surprise the Fed Chair, head of an association of bankers, is also "concerned" about the FB crypto project, Libra?

  30. Dont be fool… It may sound cool… but its just one step ahead of absolute control…. Cash less= full control.

  31. USA is now officially 2nd world country lol poor Americans are still fighting over old century problems.

  32. u talk as if ppl in china deposit money directly into the app without a card which is not true. There r still place for a bank account, but more pressure will be put on bank to get ride of all those "smart“ fee like overdraft fee(btw bank in China dont charge overdraft fee in the first place).

  33. There is a huge miss understanding here, Chinese mobile payment can be work mostly without bank account or bank card but it still have some functions highly connect to banks. Also, using Chinese bank has alot differents for US bank. You better to check the specific police of the Chinese banks.

  34. You didn’t even research enough. What do you mean Chinese people don’t have bank accounts? We have to have bank account first than we can use QuickTakes or whatever you called it …..

  35. Wow 😮 it worked . I just received a wire transfer of $25,000 in my bank account which we shared 60-40 with no upfront charges or sending money to anyone before the hack. I will continue to sing his praise WhatsApp +1(619)720 0748

  36. Who told you many Chinese people do not have bank accounts?Comments after detailed research would be a better way to post something online.

  37. I don't think it is possible to eliminate the banks because the Value being transacted electronically must have a physical presence in a bank account.

  38. Load of crap! Its like ATMs are not everywhere in China too? And what about the Chinese Banks? Who are U.S. to worry?

  39. Why make the consumer spend more just to profit the bank, as a consumer we would be more than happy to spend less and get more. The bank serve as a robber in this case. Not to mention U.S steal the paper money system from china. A real thief calling other "thief". Everything the banks offer is a debt trap

  40. Yes, too big too fail(government to assure banks), national security (can not follow China), and privacy (protect illegal purchases and under the table earnings)。。。

  41. You have absolutely no idea what your're yapping about. Both AliPay and WeChat wallet are connected to the actual bank acc. and cannot operate if you don't have one!

  42. I could now see why most companies enforce direct deposit. Even when you dont use direct deposit, theres a fee to cash out. Banks make billions penny pitching every single worker. Im sure every person that heard of bitcoin before it became popular are slapping themselves in the face and unfortunately im sure the rich bankere has already inquired all the bitcoins thats out there.

  43. The Chinese are surpassing America in just all realms of human activity…
    Soon arrogant America will inevitably be shoved to the sidelines of history and have to line up behind the British in this less than honorable league of Ex Global empires…

  44. "Many Chinese don't even have bank accounts"😂😂😂😂😂😂I get what you are trying to say, but this statement is so wrong…for any Chinese to use any payment app, a bank account is a must…do your homework please…

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