back to article China's Big Tech companies taught Asia to pay by scanning QR codes, but made a mess along the way

From Bangalore to Beijing, when Asians go out to shop, they seldom use a credit or debit card and instead pay using their smartphone to scan a QR code. While this form of payment is occasionally seen outside Asia, across the continent it is utterly ubiquitous. It also typically costs the shopper nothing extra and costs …

  1. Anonymous Coward
    Anonymous Coward

    Also here in Switzerland

    Payment by QR code has become ubiquitous in Switzerland, thanks to a system which lets each bank create an app connected to your bank account. But for most, I think the killer feature is being able to send money to people just by knowing their phone number. This is how you send money to your friends when they paid for lunch, or kids pay the teacher for school books.

    This was possible because all major banks joined to create the system, and offered low fees to stores to drive adoption. Meanwhile payments systems offered by big tech usually fail because only a fraction of users use them, so you don't get the convenience of knowing it always works.

    1. DS999 Silver badge

      Re: Also here in Switzerland

      Meanwhile payments systems offered by big tech usually fail because only a fraction of users use them

      Seems to me it is all about who gets there first. Apple Pay (and whatever Google calls theirs now) is everywhere in the US, at least where I live (in the midwest, not a tech hub like SV or NYC) I can use even Apple Pay in this crappy little townie bar I visit once in a while with an owner so cheap she wont spring for a POS system so they make do with writing food orders on paper tickets and using a cash register that probably dates to the first generation of electronic calculators. About the only places you can't are places like Walmart that want to use their own payment system, or those whose payment providers haven't yet upgraded their terminal to one that supports NFC.

      But if no one was using credit or debit cards in the first place in a country then there's no payment terminal to support Apple Pay, and no credit or debit card to link with it. You can use an iPhone/iPad as your payment terminal now (and I assume the same is true with Android stuff) which is great for small shops but they needed to support that from day one to have a chance at winning the markets that QR codes are now dominating.

      So I think things are going to remain fragmented, and those who travel will have to be prepared for how they'll be expected to pay in other countries. The days when between having a credit card and exchanging for some local cash when you arrived were all you need are long gone. I'm glad my mom is too old for international travel these days, she barely uses her smartphone for calling. She's never used the camera, texting, or apps. She's traveled the world more widely than 99.9% of people, but she'd be lost in today's world because its so tech dependent and she has never gotten on with technology. She might be able to figure out the QR code thing, but in some places it isn't even that - you need one or one or more (depending on competition) particular apps, that have to funded somehow. That's rife for scamming unwary travelers, especially older ones who are less technologically adept and perhaps a bit more naive to scams related to technology.

    2. John Hawkins

      Re: Also here in Switzerland

      And in Sweden. Also here the payment system connects though a cell phone number and is a simple way of dealing with both smaller and larger payments directly from your bank account. Scan the QR and approve the payment in the smartphone app. Used by small and by large merchants as well as for private money transfers.

      The app is linked to the main local MFA solution (probably others as well), which can be set up to use fingerprint authentication, a PIN or both.

      Scammers get around the system by persuading people to sign off transactions that they're not fully aware of, but that's not very different from giving someone a signed blank cheque.

  2. Captain Hogwash

    Biometrics

    I better start dressing poorer unless I want to get frogmarched around an assailant's shopping spree.

    1. Michael Wojcik Silver badge

      Re: Biometrics

      Whatever the problem, biometrics is the wrong solution.

      1. Captain Hogwash

        Re: Biometrics

        I agree.

  3. Pascal Monett Silver badge
    Windows

    "The next step is biometric"

    Because of course it is.

    And thank you for specifying that debit cards are a thing in France (and Europe in general).

    It seems to me that "alternative" systems of payment only get traction when a proper banking environment doesn't exist. In China, it's QR codes, in the US, it was PayPal, and now it's smartphone bonking.

    I live in France, I work in Luxembourg, and I purchase things in France, Luxembourg, Belgium and Germany (and online, obviously). All with my VISA. I have no trouble doing so, and I don't feel the need to adopt a another payment process. What I've got works. I'm not bothered with sending a friend some lunch money : it'll be my turn next time is all.

    And, since I'll never be going to China, I'm not interested in QR code payment. I'm also very much not interested in loading a smartphone with my banking data - until the day you can prove to me that some miscreant somewhere has to do more than send me an SMS to hack it.

    Now get off my lawn !

    1. Anonymous Coward
      Anonymous Coward

      Re: "The next step is biometric"

      The Netherlands managed to go backwards about 20 years. Although the banks happy to charge commissions to customers they are too tight to pay Visa and Mastercard so they came up with iDEAL which is great for banks as the end customer pays the commission on top of the cost of purchase, there is no chargeback if the merchant doesn't deliver, and there isn't any way of getting scammed money back. Many Dutch establishments now only take iDEAL, why wouldn't they if the customer pays the commission and there's no nasty chargeback? Also there is Tikkie which allows the person who you thought generously bought a round yesterday to send you an itemised bill over WhatsApp, and to actually transfer the payment you need iDEAL.

    2. DS999 Silver badge

      Re: "The next step is biometric"

      in the US, it was PayPal, and now it's smartphone bonking

      You think the US doesn't have debit cards, or a "proper banking system"?

      Paypal was only ever a thing for buying over the web, never for in-person transactions. Given a choice I'd use Paypal to buy something over the web versus giving a DEBIT CARD for an internet transaction. That's positively insane! What happens when your debit card information is breached through a cyberattack on your online vendor's web site, and they drain your bank account? What do you do in the time between that and the the time it takes for your bank to become convinced you didn't make those charges and replace the money??

      I don't use my debit card for anything EVER, except getting cash from an ATM. I refused a debit card and got an ATM only card for as long as I could, until my bank offered only debit cards. I'll use credit cards instead because if that's breached they take money from the credit card company, not from your bank account, so you won't have payments bounce before you can resolve the situation.

      And "smartphone bonking" requires debit/card cards. Yes you can use Apple Cash as an Apple Pay payment method, but they implement that as a virtual debit card so it amounts to the same thing. It is using the same NFC technology you're likely using in the UK/EU to tap to pay with a debit card, so there's no difference at all - except that it is one less thing to carry since you're going to bring your phone or watch when you leave your house anyway. If I'm going somewhere I know takes Apple Pay like the grocery store or the townie bar I mentioned previously I don't even bring my wallet. The phone and car fob are all I'm carrying with me.

      1. Anonymous Coward
        Anonymous Coward

        Re: "The next step is biometric"

        France had Chip and PIN since 1992, the UK since 2005, and it took Google and Apple to bludgeon US banks and commerce into updating to EMV contactless card readers and even then it was just large stores which had new card readers which accepted Chip and PIN or mobile payments. The rest were still stick on magstripe or Chip and Signature in the year of our lord 2016.

        Thank you for explaining the wonders of mobile payments. We here in the hinterlands would never have known how they worked otherwise.

      2. Michael Wojcik Silver badge

        Re: "The next step is biometric"

        Paypal was only ever a thing for buying over the web, never for in-person transactions

        I wish. Around these parts (the largely-rural Southwest), Paypal was widely used for services and small purchases. It's gradually being replaced by Venmo and whatever other flavor-of-the-month payment systems are coming along, but Paypal was the default for years. Many people didn't take credit/debit cards, were reluctant to take checks, and didn't have cash on hand to make change for cash payments.

        What happens when your debit card information is breached through a cyberattack on your online vendor's web site, and they drain your bank account?

        My bank provides limited liability and fraud detection on debit cards. Sorry yours doesn't.

        That said, I rarely use the debit card myself. In person I generally use a credit card, as that provides maximum security; like Pascal, there's no way I'm putting payment information on the ghastly bundle of security vulnerabilities that is a smartphone. Online I use virtual credit cards which are locked to a single merchant and have preset spending limits. (My bank will reverse charges on those too, but with those additional barriers there's less mess to be cleaned up if a merchant is compromised.)

    3. Triggerfish

      Re: "The next step is biometric"

      However some of us do live in and travel in cou tries that QR is used so it's useful to us to read.

      I think your missing a reason why visa and so on never got traction as much over here vs QR. Because you can certainly use it in larger stores and chains.

      As it mentions in the article.

      You need a POS system, and many places don't have them, the average market stall, street food, corner shop, taxi driver etc just doesn't have that sort of set up in a lot of places like SEA and China, their owners do have smartphones.

  4. Anonymous Coward
    Anonymous Coward

    "If you look at China, they are innovating a lot with biometric solutions and moving away from the QR code," said Ondrus

    China has been innovating with biometric payment for years, and QR codes are still here and doing fine. Payment systems take time to get established and once there, aren't easy to change, because it's definitely something people want to be stable.

    See Alipay's Smile to Pay for example:

    https://bankautomationnews.com/allposts/payments/alibaba-introduces-smile-to-pay-facial-recognition-technology/

    1. Dan 55 Silver badge

      What, do I have to smile when giving money away now? Does a grimace work just as well?

      1. A. Coatsworth Silver badge
        Big Brother

        Nope, not dystopic enough: Smile for Big Brother, citizen!

      2. Michael Wojcik Silver badge

        I admit I'd be a bit tempted by rude-gesture-to-pay.

  5. Anonymous Coward
    Anonymous Coward

    Sinagpore

    > The process meant that all wallets had to be compliant to SG QR and work with NETS to integrate.

    NETS seems a bit like the UKs defunt Switch. Whats wrong with VISA and Mastercard?

    Hmmm, Singapore QR still doesn't seem to be consistent. As a frequent visitor to Singapore I need to pay at Hawker Centres using QR codes.

    Wise to huge fanfare trumpted support for paying with QR codes in Singapore, but then very quietly withdrew it.

    Nearly all Digital Wallets in Singapore require you to be a Singaporean or have a FIN. Grab Wallet seems to be the exception, and allows you to spend a few thousand a dollars year without verifying. The drawback - Grab Wallet pay by QR code only works on some QR codes. Even now. Seems to fail on personal QR codes used by Hawkers mostly.

    https://www.instagram.com/p/Ce-dlP4hm8D/

    WTF? So always carry cash in Singapore.

    The other drawback to QR codes is that an Internet connection is required, and its easy to make a mistake typing a number. And thats before you talk about fraud with bad actors sticking a different code over the genuine one (see UK car parks).

    Most Hawkers and small shops use personal QR codes, so then you look at your statement at the end of the month you will see transactions to, Ms M Lee, Mr L Ho, etc and no idea where you spend the money. Unless you spend time typing in an optional note (much to the annoyance of everyone else behind you in the fishball noodle soup queue).

    Outside of Hawker centres in Singapore most places accept contactless (locally called PayWave) VISA/Mastercard. However there are some notable pecularities, where MRT topup machines will not accept foreign credit cards. And PayWaving a foreign card on a Bus or MRT will hit you with a $0.60 a day surcharge. So get an EZLink card, and the SimplyGo app which does allow you to use foreign cards to topup. But then you don't see how much the trip costs on the turnstiles. Shame you cannot use EZLink cards at Hawkers.

    None of it seems very joined up to me.

    1. Michael Wojcik Silver badge

      Re: Sinagpore

      QR codes are a horrible mechanism, full stop. Just a terrible idea. I have a QR code somewhere that I generated for a lmgtfy.com search on "security risks of QR codes" or something along those lines, which I used to occasionally use when someone suggested using QR codes for something.

      Fun experiment: Throw up a very simple site that just logs the UA information. Print up QR code stickers for it and go around slapping them over legitimate QR codes. After a week, see how many outdated browsers with known vulnerabilities have hit the site.

  6. Anonymous Coward
    Anonymous Coward

    QR payment(provider)s are big in South America too

    QR Payments (or at least their providers) are big in South America too, including paying directly with debit/credit cards using QR codes. In the bits I know of, the reason for their rise wasn't so much lack of bancarization[1] but unwillingness to pay card processing/PoS setup fees, greater maneuvering margin for tax evasion with QR (vs card), and in some rather rare occasions, lack of infrastructure. However, the commissions on QR payments (esp. the near-monopoly provider) are insane[2], so most big supermarket chains do not accept them (only the much cheaper bank-backed QR or their own wallets), and small shops will force you to do an old-school, immediate accreditation, 100% free[3], bank transfer with our organic, free range IBAN-like number (at least we can set more human names -- "alias"es -- to them). Interoperability was always an issue, but since ~2021 all QR codes are interoperable when using money held in the wallet, and interoperability for paying with cards should start rolling soon™️.

    [1]: Countries I have the most experience with have at least one of:

    a) Laws mandating all (lawfully hired and registered) employees receive their salary in a bank account (no checks/cash/etc)

    b) No signup-charge no-monthly-maintenance no-transfer-fees bank accounts (you still pay for card reissues in case of loss/theft, and commissions for the more esoteric bank operations)

    [2]: Up to 10% when paying with credit card using QR, compared to ~0.5-1% (and accreditation in the merchant's account in ~2 business days) when paying with debit card.

    [3]: Business transferring/receiving money in a business account do pay per transaction (~0.5%), but many small shop owners use their personal accounts. Some taxes may be retained by the bank (ie, transferred directly to our IRS/state equivalent) depending on your business license, who bought the thing, etc.

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