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Chinese vendors are refusing to accept cash and it’s becoming a problem
In the 10 months from January to October 2017, mobile payment transactions on the mainland surpassed $12.8 trillion. But for those that prefer cash, this is becoming a problem. Many have noticed that parking lots, small supermarkets, food street stalls have become reluctant to accept Chinese yuan bills and the anecdotal evidence has now been confirmed by Chinese authorities.
In Anhui province, China’s central bank, the People’s Bank of China (PBoC) has set up a Working Group on Reception of Renminbi Cash, Xinhua reports. Its task is to rectify renminbi cash rejection to maintain normal circulation and protect consumer interests.
“This practice not only damages the legal status of the renminbi but also infringes the legitimate rights and interests of ordinary consumers and deprives consumers of the right to choose their mode of payment. Especially for the elderly and those unable to use mobile phones, their rights and interests are increasingly encroached upon,” Xinhua quoted Wang Yazhou, a member of the Hefei sub-branch of PBoC.
The PBoC has promised to do more to regulate cash acceptance and safeguard the legal status of the renminbi. Recently, regulators have been more strict towards the country’s mobile payment market 90% of which is split between Alibaba’s Alipay and Tencent’s WeChat Pay.
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In July, Alipay and Tencent’s Tenpay were each fined RMB 600,000 ($88,000) by the State Administration of Foreign Exchange (SAFE) for breaking rules in foreign exchange transactions.
During August, the PBoC fined four mobile payment operators a combined RMB 100 million ($14.7 million) in a move to increase oversight. Alibaba’s Ant Financial was fined RMB 4.12 million ($604,000), Union Mobile Financial Technology RMB 26.4 million ($3.9 million), and Gopay RMB 46.4 million ($6.8 million). No reasons were given for the punishment, but Alipay said it was due to “certain irregularities” in its payment operations in mainland China.