You can now use Apple Pay on the subway in Shanghai and Beijing

QR code payments still dominate in China but NFC is gaining ground

Apple

Karen Chiu

Published: 6:30pm, 6 Apr 2018

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This article originally appeared on ABACUS

China is addicted to QR codes: The weird black-and-white square powers the country’s mobile payments, allowing people to buy everything from groceries to train tickets. It’s one of the main reasons why Apple Pay -- which uses NFC instead -- has been struggling to catch on in the country.

But Apple is forging ahead anyway -- introducing its payment services to commuters on trains, buses and ferries in Beijing and Shanghai.

Apple Pay landed in China in 2016, but today more than 90% of consumers paying with their smartphones still use either Alibaba or Tencent’s QR-based services. Fewer than 3% use Apple Pay or other apps. (Abacus is a unit of the South China Morning Post, which is owned by Alibaba.)

Cost is a major barrier: NFC requires special and often expensive hardware for shops, and a high-end smartphone for consumers. But QR codes are much simpler. All a consumer needs is a phone with a camera. And all a shop needs is the code itself!

A passenger buys a bottle of water on a train in China by scanning a QR code. (Picture: Xinhua)

But phone makers haven’t given up on NFC -- a far more secure technology than QR codes. Xiaomi, for example, has supported NFC payment on public transport since 2016. Today, it’s available not only in Beijing and Shanghai, but also Shenzhen, Hangzhou, Chongqing, and eight other regions across the country. CEO Lei Jun even touted the function on its latest flagship phone during an event last week. Similar features are also available on handsets from Samsung, Huawei and a few other Chinese brands.

Despite NFC payment’s growth, Apple is facing a few issues. On social media this week, a number of people are complaining about what looks like a common problem with Apple Pay on transit: Being charged the wrong fare.

“I used Apple Pay for four days, and was overcharged on two days…Are you assuming all iPhone users are rich?” said one Weibo user.

Another wrote, “My Apple Pay experience on the bus has been awful...I’ve gone back to using my physical transport card.”

Apple Pay is currently accepted on public transit in five countries -- including Japan, the UK, and parts of Russia and the US.

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