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WeChat Pay facilitates local currency payments in Hong Kong for purchases on mainland

A notice promoting WeChat Pay at a restaurant in Guangzhou Photo: Reuters

Internet giant Tencent has launched the Hong Kong version of WeChat Pay during the National Day holiday to allow Hong Kong users to pay for goods they buy on the Chinese mainland, upping the ante in its race with archival Alipay for the global market share.

WeChat Pay HK, the Hong Kong version of the digital wallet, enables Hong Kong consumers to directly complete payments on the Chinese mainland by means of an automatic currency conversion system within the mobile payment tool, where exchange rate and automatic currency exchange services are available.

It makes Tencent the first Chinese company to allow WeChat users to settle bills for purchases on the Chinese mainland in Hong Kong dollar. Previously, WeChat Pay HK could only be used locally and was not accepted by Chinese mainland merchants as a mobile payment tool due to differences of jurisdiction and payment systems between the two places. So Hong Kong consumers had to convert Hong Kong dollar to the Chinese yuan before traveling to the Chinese mainland.

Launched in cooperation with China UnionPay, the mobile payment connectivity is endorsed by the People's Bank of China, the country's central bank, and is seen as an opportunity to promote business cooperation, personnel exchanges and trade between the Chinese mainland and Hong Kong.

"The cross-border mobile payment will provide more cooperation opportunities to Hong Kong and mainland businesses," said Jim Lai, president of Tencent. "The cultural and talent exchange and stimulation of economic activities across a wide range of sectors will serve to strengthen the mutual relationship between Hong Kong and the Chinese mainland."

In a previous statement, Tencent said that mainland merchants including car-hailing company Didi Chuxing, on-demand services provider Meituan-Dianping and railway ticketing site 12306.cn would accept payments made via WeChat Pay HK.

The launch of the cross-border mobile payment service comes days after the formal operation of the Guangzhou-Shenzhen-Hong Kong express rail link, which is built for facilitating visits by both mainland and Hong Kong residents. Since its opening on September 23, the Hong Kong section of the high-speed rail handled more than 800,000 passenger trips to and from the Hong Kong Kowloon Station, said MTR Corporation, the rail's operator, on Sunday.

Currently, some 520,000 Hong Kong people permanently live in southern China's Guangdong province, said Hong Kong's Census and Statistics Department. The department's statistics showed that Hong Kong residents consumed more than $30 billion during their trips to the Chinese mainland in 2017.

This trend is expected to be cemented by the ongoing construction of the Greater Bay Area, which links Hong Kong, Macau and some cities of Guangdong province into an integrated economic and business center. In summer, Tencent announced to launch a digital pass system, which is tied to the WeChat app, to facilitate travel, mobile payment and personnel exchange in the Greater Bay Area.

Caijing quoted a source close to Tencent as saying that the launch of the Hong Kong version of WeChat Pay is an "important part" of the company's global expansion plan, which also focuses on increasing the acceptance of WeChat Pay among foreign merchants in a bid to better serve a growing number of Chinese outbound tourists.

Besides designing the local versions of WeChat Pay, Tencent is eyeing travel destinations like the United States that are popular among Chinese tourists.

In July, Tencent announced plans to connect more American merchants with WeChat Pay in a two-step approach. In the first phase, some American merchants including duty-free stores, famous restaurants and transportation services providers which are well recognized among Chinese tourists will be selected for cooperation, followed by the second phase with a focus on establishing partnerships with bigger local merchants which are popular with Chinese tourists.

Ant Financial's Alipay has competed with WeChat Pay for years to increase the number of selected overseas merchants that can accept Alipay-enabled mobile payments made by Chinese outbound tourists.

In addition to its foray into the United States and Europe, Alipay has recently taken the opportunity of the Tokyo Olympics 2020 to deepen its foothold in Japan, with an expectation of a Chinese craze for Japan tours by 2020.

During the National Day holiday which ran from October 1 to 7, Japan eclipsed Thailand for the first time as the most popular destination for Chinese tourists, according to Ctrip.com, a leading travel agency in China.
 


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