How China’s Mobile Ecosystems Are Making Banks Obsolete

Very interesting. However, not a good scenario that Amazon and Facebook run the world… Nor that cash is given the cold shoulder. However, there are possibilities local communities can monetize their own credit so interesting to see how it pans out. Don’t cry for the banks, they have had a very good run…

WEB OF DEBT BLOG

Giant Chinese tech companies have bypassed credit cards and banks to create their own low-cost digital payment systems.

The US credit card system siphons off excessive amounts of money from merchants, who must raise their prices to cover this charge. In a typical $100 credit card purchase, only $97.25 goes to the seller. The rest goes to banks and processors. But who can compete with Visa and MasterCard?

It seems China’s new mobile payment ecosystems can. According to a May 2018 article in Bloomberg titled “Why China’s Payment Apps Give U.S. Bankers Nightmares”:

The future of consumer payments may not be designed in New York or London but in China. There, money flows mainly through a pair of digital ecosystems that blend social media, commerce and banking—all run by two of the world’s most valuable companies. That contrasts with the U.S., where numerous firms feast on fees from…

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