A driver pays a highway toll using mobile payment method Alipay in Zhejiang province.
A driver pays a highway toll using mobile payment method Alipay in Zhejiang province. - 
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Update Jan. 22, 2019: A few of you had a hard time believing a statistic in this piece — how can there have been $23 trillion in mobile payment transactions in China in 2016 when the country's GDP was only $11.19 trillion that year? Not only is it possible, but the total amount of mobile transactions in China was even higher that year. Read more in Jennifer's follow-up report.

It’s been more than six years since the World Trade Organization ruled that foreign credit card companies should be able to operate freely in China, but it still hasn’t happened.

And it might already be too late for Visa, Mastercard and American Express to compete there. Only one in two people in China has a credit card, according to the People's Bank of China. The average American has 2.6  cards.

In major cities like Shanghai, residents can get by with just two mobile payment apps: Alibaba’s Alipay and Tencent’s WeChat Pay.

Mobile payment has exploded in China. In 2016, Chinese consumers made about $23 trillion (157.55 trillion yuan) worth of transactions through mobile payment platforms, according to the People's Bank of China. That compares to an estimate of just over $100 billion in the U.S. that same year.

How three people in Shanghai pay for things

Mobile payment is accepted by almost all small vendors in major cities in China.
Mobile payment is accepted by almost all small vendors in major cities in China. - 

Jennifer Pak, Marketplace China correspondent

Forms of payments used in the last 72 hours: Mostly WeChat Pay, Alipay

Places of purchase: Local vegetable and seafood market, fruit store, DiDi rideshare app, supermarket, e-commerce app Taobao by Alibaba, restaurants, Shanghai utilities

Items: Vegetables, seafood, meat, fruits, baking soda, taxi fares, children’s toy, utility bills, meals at restaurants

Cash use: Once, to pay for Chinese language lessons

 

Cheng Zhao is a student living in Shanghai.
Cheng Zhao is a student living in Shanghai. - 

Cheng Zhao, student

Frequency of mobile payment use: 90 percent of transactions

Last time cash used: To pay for a pack of cigarettes from a vendor who didn’t accept mobile payments

Credit cards: One, to get reward points on big purchases like cellphone or jewelry

Number of times credit card used in the last 12 months: Once

Worried about the concentration of personal data in the hands of tech giants Alibaba and Tencent? No. “Since they launched [mobile payment apps], this has benefited the public and [the firms] also profited from it,” he said. “They will collect big data from me and make even bigger profits for themselves, but that's normal. Both sides can benefit from it.”

Auchan automated convenience shops in Shanghai only accept mobile payment.
Auchan automated convenience shops in Shanghai only accept mobile payment. - 

Hu Jianli, from eastern Shandong province

Preferred methods of payment: Wechat Pay and Alipay

Cash use: Very rarely. “When I leave the house, I just take my phone usually,” he said.

Credit cards: None. “If I use it, I have to pay back the money," he said. "It’s better to spend what I have in my bank account.”

Is mobile payment safe? Very secure. There are passwords, and it’s tough to crack them," he said. "If I lose my phone and other people take it, they need to reboot my phone, and all my information stored in [the mobile payment apps] will disappear.”

 

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Follow Jennifer Pak at @jpak25