【推荐2】Does Cashless Society Discriminate Against the Poor and Elderly?

The increasing prevalence of cashless payments, including mobile phone payments, digital payments and credit cards, in the world means that cash circulation is dropping worldwide. In major cities in China, over 90 percent of people use WeChat and Alipay as their primary payment method, ahead of cash. In the US, the use of cash is just 16% of total transactions and is expected to decline as cards growth accelerates.

    1     Compared with the poor, the elderly, in fact, are comparatively less able to manage cashless payment methods. If local authorities or utility companies do not support cash, the elderly may face hurdles to pay for basic services.

In some countries, retailers may charge more for accepting cash or refuse cash payments altogether.     2     For those who do not qualify for credit cards, or cannot afford mobile payment methods, they are excluded from these retailers.

In addition to being locked out of retailers, low-income people who participate in cashless payments options face severe punishments for overdraft (透支) fees from their savings accounts and are actually more likely to be unqualified to receive credit cards who reward wealthy users for money spent.     3    

Thus, there is a population who require cash and need to be addressed by retailers and companies. Governments can protect financial inclusion for people who are unable to participate digitally. In the US, The Cashless Retailers Prohibition Act of 2018 would make it illegal for restaurants and retailers not to accept cash or charge a different price to customers depending on the type of payment they use.     4     In Singapore, the government holds classes to help its senior population learn how to use digital payments such as paying in store using QR codes and topping up travel cards with debit cards.

As society moves towards cashless payments, to ensure that all groups in society are able to fully participate in the changing landscape, governments should introduce laws to protect cash acceptance and be mindful of impact on disadvantaged groups when encouraging fintech industry.

【推荐3】AI, 5G, cloud computing and other digital technologies are not only changing our lives but shaping the economy as well.

China’s six major commercial banks are stepping up digital wallet efforts to provide new drive for the e-CNY (数字人民币) trials in the country, as reported by Shanghai Securities News on March 23.

“The functions and properties of the-CNY are exactly the same as those of the paper currency, except that the form is digital,” said Mu Changchun, head of the People’s Bank of China’s Digital Currency Research Institute.

Many people are puzzled by e-CNY and electronic payments. “Digital currency has the characteristics of both paper money and electronic payment,” said Wu Qianhong, a professor at the School Electronic and Information Engineering, Beihang University. “In theory, digital currency can replace paper money, Alipay and WeChat payments.”

Compared with Alipay and WeChat payments, e-CNY features anonymity (匿名性) and security. E-commerce platforms that accept payments via e-CNY will not have access to user’s personal information. E-CNY users can open an anonymous digital wallet by registering a mobile phone number, and telecom operators cannot disclose (泄露) customer information to the central bank or any third-party institutions. Mu noted that e-CNY user’s privacy protection is at the highest level among all the existing payment tools.

Similar to Alipay and WeChat payments, using e-CNY requires an account. After obtaining the other party’s account number, users can enter the amount of digital money to transfer (转钱) and then enter the payment password to complete the transaction (交易). However, the process behind these transfers are different. For electronic payments, the transfer has to go through a third party, and the receivers will get the transferred money only when they withdraw money from banks. But e-CNY transfers only need a payer and a receiver to complete a transaction. Therefore, it guarantees risk-free payments, according to Wu.

In simple terms, e-CNY can be considered “money”, while electronic payments are like “wallets”.