The Renminbi: China's Legal Tender
The legal currency of the People’s Republic of China is the Renminbi. Issued by the People’s Bank of China, it is the sole legal tender for both the Chinese nationals and foreign tourists. PBC is the only state agency responsible for its design, printing and issuance. The currency is often abbreviated RMB, or indicated by the sign ¥.
The latter may be written CN¥ to distinguish it from other currencies with the same symbol. The ISO code for the Renminbi is CNY or also CNH when used in off-shore markets. The basic unit of Renminbi is yuan and its subsidiary units include jiao and fen. RMB is issued both in notes and coins. Up to date five series of RMB have been issued, forming a multi- variety and multi-series monetary system. The fifth series was issued in 1999 which is currently in circulation.
On November 30, 2015, the International Monetary Fund announced that the RMB would be formally included in the IMF Special Drawing Right currency basket. The resolution came into force on October 1, 2016. On October 1, 2018, the RMB became the first emerging market currency to be included in the IMF’s SDR basket.
Credit Card Services in China
Credit Cards
The relevant law of China has stipulated that credit card refers to electronic payment cards issued by commercial banks or other financial institutions with all or part of the functions of consumption, payment, credit loans, transfer and settlement, cash withdrawal and so on. On December 1, 2017, it was formally provided that its standard English name is Credit Card.
Now most of China’s state-owned commercial banks issue dual-currency cards, allowing card users to purchase goods within China in RMB and overseas in US dollars (Visa/MasterCard/AmEx/JCB), Euros (Visa/MasterCard), Australian dollars (MasterCard), or Japanese yen (JCB). Nevertheless, only BOC provides Japanese yen and Australian dollar-denominated credit cards.
The Chinese government wanted to develop credit card-related hardware, including POS and ATMs, credit card-related software for banks and merchants. Credit cards are widely accepted in upmarket, restaurants and hotels and in large tourist shops, but always check before attempting to make a purchase.
UnionPay Credit Card
UnionPay, also known as China UnionPay or by its abbreviation, CUP, is a Chinese financial services corporation headquartered in Shanghai. It was launched on March 26, 2002 to set up a national processing network connecting merchants and banks and such banks as ICBC, ABC, BOC and CCB served as its first members. It is the only interbank network in China that links all the automatic teller machine (ATM) of all banks throughout the country and also an electronic funds transfer at point of sale (POS) network. In addition, it is the largest card payment organisation in the world offering mobile and online payments based on total value of payment transactions, ahead of Visa and MasterCard.
UnionPay has set up bankcard network service centers in 18 cities in addition to a national bankcard information switch centers. In 2007 five non-mainland banks were allowed to issue bank cards in China, with Bank of East Asia also allowed to issue UnionPay credit cards in the mainland. At the end of 2008, there were 196 issuers in China that issue China UnionPay-branded cards. These issuers include the “Big Four” banks as well as fast-growing banks and city commercial banks, and even some foreign banks with local operations. In 2005, UnionPay entered into agreements with other payment networks to increase acceptance around the world, which include Discover in USA, RuPay in India, JCB in Japan and BC Card in South Korea.
Mobile Payment Giants: Alipay and WeChat Pay
Alipay and WeChat Pay
Alipay, a third-party mobile and online payment platform, was established in Hangzhou, China in February 2004 by Alibaba Group and its founder Ma Yun (Jack Ma). It moved its headquarters to Shanghai in 2015 while its parent company remains Hangzhou-based. The platform is committed to providing “simple, safe and fast” payment solutions. Since its establishment it has always regarded “trust” as the core of products and services. Since 2013, it has overtaken PayPal to become the largest mobile payment company in the world.
Since April 1, 2018, payment by Alipay and WeChat static bar codes has set down the daily limit of 500 yuan. On August 21, 2018, Alipay released to have upgraded the function of delayed arrival comprehensively so that the swindled funds are expected to recover. On February 2, 2019, Alipay has obtained the national certification. Since March 26, 2019, service fees will be charged for repayment through Alipay to credit card.
Up to March 31, 2018, the number of Alipay users reached 870 million. Now it is the world’s number one mobile payment service organization and the second largest mobile payment service organization in the world. Internationally, more than 300 worldwide merchants use Alipay to sell directly to consumers in China. It currently supports transactions in 18 major currencies of foreign countries.
WeChat, a Chinese multi-purpose messaging, social media and mobile payment app developed by Tencent, was first released in 2011, and by 2018 it was one of the world’s largest standalone mobile apps with over 1 billion monthly active users. Described as one of “the world’s most powerful apps” by Forbes, it is also known as China’s “app for everything” because of its wide range of functions and platforms.
Daily convenient payment is one of its functions now popularly used among Chinese consumers, especially the younger generations. In China, users of WeChat who have provided bank account information may use the app to pay bills, order goods and services, transfer money to other users, and pay in stores and vendors if WeChat payment option is available. Users can link with WeChat their Chinese bank accounts, as well as Visa, MasterCard and JCB in order to pay conveniently. As a digital wallet service incorporated into WeChat, WeChat Pay allows users to perform mobile payments and send money between contacts. After payment and money transfer, users receive immediate notification of the transaction.
