News > FinTech

Why users are raging at WeChat's new payment charges

By NexChange
FinTech

WeChat, the popular Chinese social messaging app owned by Tencent, has started to charge its users for its payments and money transfer services and they are very unhappy about it.

The amount being charged is small — 0.1% on spending and transfers over 20,000 yuan — but it has still managed to irk users who until now have been getting the services for free, according to Tech In Asia.

The most galling aspect is that WeChat is competing Alibaba's Alipay which currently holds the lion's share of the market. Alipay doesn't charge users for its services (unless they are using the website were it charges 0.2%). Tech in Asia quoted one Zhengzhou-based user as saying:
"Alipay controls more than 70% of the market, and WeChat only controls more than 10%. I really don’t know where [Tencent CEO] Pony Ma’s confidence is coming from?"
It's a good question, but there is perhaps an equally good answer. While Alipay dominates now, WeChat has a few tricks up its sleeve. As the country's number one messaging app WeChat has a suite of products it can draw from to incentivise users to sign up to its services.

These services include WeChat's Chinese New Year red envelopes promotion, for gifting money to relatives, and City Services, a platform that allow users to manage things like a doctors appointments and handle utility bills via its chat app. This is likely why users are so angry, because many are so tied into WeChat's ecosysyem that there is very little they can do about it.
Photo: Steven Depolo
 

Subscribe to our Newsletter

Be one of the first to experience the future of financial services