Lunar New Year
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A photo illustration of a WeChat user scanning a QR code to retrieve a digital red envelope on the WeChat app on a mobile phone during the Lunar New Year period in Beijing, China, 30 January 2017. Photo: EPA/STR

The Chinese tradition of giving red packets gets a digital update, keeping it alive and well

  • Those born in the 1990s were the most enthusiastic users of digital hongbaos, or red packets, according to WeChat data

One of the enduring traditions for Chinese communities globally is for adults to give the young red packets containing money during the Lunar New Year as a blessing of good luck and well wishes.

Broadly speaking, many Chinese consider marriage as the definition of adulthood, and therefore those who have entered into matrimony earn the right to dispense red-paper packets to those who have not.

Bosses also give “lucky money” to subordinates, while in many places, Chinese would give service staff small sums of money, much like how New Yorkers might tip their doormen for Christmas. Hongbaos, the Mandarin pronunciation for red packets, are also given on occasions such as weddings, births and birthdays.

This tradition is undergoing a major digital update in China, where instantaneous money transfers can be made with the tap of a smartphone.

Data released this week by WeChat, the most popular social app in China with more than 1 billion users, showed that those born in the 1990s are the biggest givers and receivers of virtual red envelopes, followed by those born in the 1980s and 1970s.

The function was introduced by WeChat in 2014 and allowed users to hide the amount being sent until “opened” by the recipient. There are also settings for red packets to be sent to a group with random amounts depending on one’s “luck”.

Beijing, Chongqing and Chengdu led the cities in China in terms of sending and receiving the most number of red packets. They were followed by Shenzhen and Guangzhou in fourth and fifth place, respectively, according to the WeChat data.

Mobile payments and transfers have become so popular in China that the central bank had to remind businesses last year not to discriminate against cash. Alipay and WeChat Pay, the two dominant mobile-payment apps, accounted for more than 80 per cent of the segment.

Digital payments solve the problem of handling small change, or accepting dirty, tattered bank notes that vendors try to palm off onto customers and vice versa. Counterfeit notes were also a big problem in China in the past. Today, one seldom sees cashiers hold up 100-yuan notes against the light to check for watermarks or run their fingers against the notes to check the texture.

With time to come, maybe the long queues of customers at banks for crisp, new bank notes may also dwindle. But the act of giving red packets during Lunar New Year looks set to remain alive and well.