Updates on Personal QR-code for Payment Using WeChat and Alipay
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A recent notice by the People's Bank of China on strenghening the management of payment portals and related business transactions attracted a huge debate online.
One of the most debated topic online was QR-code payment acceptance. Businesses, especially small businesses and street vendors use this code to collect money from clients. This convenient method of transaction can be easily abused by internet fraudsters and money launderers to hide their activity online.
Most of the articles concluded that "From March 1st, personal payment QR-codes will be cancelled."
The announcement was misinterpreted as saying that personal QR-code payment portal will be cancelled, but it was soon revealed that users can still receive payment through QR-code face-to-face after March 1st.
That means for one, remote transactions through a personal QR-code will be limited and managed (Not cancelled).
Two is that these transactions should not be used for business transactions.
Three is to classify and manage the payment QR-codes, distinguish between individuals and merchants, and include those with business activities into a special type of merchants.
What is the Difference Between a Personal and Merchant Account?
Personal payment account is easy and convenient, Weixin and Alipay issues QR-codes to normal users who would like to receive payment from clients. There is no transferring fees and normally it only requires a bank account and a form of an ID card to apply for this.
Merchant payment account however, is complicated. One needs a registered business license and a merchant bank account to be able to apply for it. And there comes the steep fees that a user needs to pay for each transaction. For instance, Weixin will charge a percent of each transaction you make.
But then another debate ensued, how about street vendors and small businesses that does not make much profit, how will they cope with transferring fees as merchants?
Good news is that Weixin and Alipay have issued statements clarifying the interpretation of this new guideline.
Weixin response
In short:
Weixin: Personal payment QR-codes can still be used, but there is an option to apply for a ledger account for business people (this can also be interpreted as a personal business acccount), which can enjoy other benefits among the benefits offered by a personal QR-code.
▲Alipay response
Alipay: Personal payment QR-codes can still be used and enjoys free transfer fees and other services. From March 1st, one can upgrade to a "Personal business payment QR-code" where they can enjoy all the benefits of personal payment QR-code and upgraded services for merchants.
So, there is no need to panic, good luck!
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