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I’ve never been nor kept up with SEA, but this is still surprising to hear! I would have assumed WeChat type mobile payments situations were well in place, is c

I’ve never been nor kept up with SEA, but this is still surprising to hear! I would have assumed WeChat type mobile payments situations were well in place, is cash really that dominant or are there other factors?

vetinari 6y ago
One reason is, that cashless transfers costs money; e.g. the card processing companies in their contracts disallow the vendors to increase the prices for customers using their payment system, compared to other means of payments. So effectively all the cash paying customers subsidy the electronic payments systems, while not having the convenience of not using cash. This part of the contract is not followed in SEA countries. If you want to pay with something that carries a fee, you are going to pay the fee on top of the price. Logically, most people will choose to pay cash then. The second reason is taxes. Most small vendors do not bother with taxing their incomes; they are too poor for that anyway, every coin helps. With electronic ledgers documenting all the transactions, that would be much more difficult. The local IRSes do not bother with chasing these people, they know that the price would be higher than revenue; so they check only businesses with significant enough turnover.
- mcv 6y ago
  Cash payments also cost money. Not small interpersonal payments, but for larger shops, storing cash safely, transferring it safely to a bank to have counted and deposit it, costs significant money. Many shops prefer electronic payment for that reason, and voluntarily eat the costs associated with it, because it's still cheaper than cash. Of course that only works if electronic payment is cheap. This is not the case with US credit card companies.
- deleted 6y ago
  [deleted]
- lotsofpulp 6y ago
  >One reason is, that cashless transfers costs money; e.g. the card processing companies in their contracts disallow the vendors to increase the prices for customers using their payment system, compared to other means of payments. So effectively all the cash paying customers subsidy the electronic payments systems, while not having the convenience of not using cash. In the US, credit card surcharges have been legal for many years: https://www.thebalance.com/credit-card-surcharges-315423 https://www.thebalance.com/credit-card-surcharges-315423
netsharc 6y ago
They were booming when I visited last year. Each vendor would have 3 or 4 devices, for each different WeChat-esque network. The networks want that sweet sweet marketshare, so they work (pay?) the vendors to have special deals like "10% off your total if you pay with $PAYMENT_APP". I think it's basically the Uber model of spending VC money to subsidize customer purchases to get that market share...

vetinari 6y ago

One reason is, that cashless transfers costs money; e.g. the card processing companies in their contracts disallow the vendors to increase the prices for customers using their payment system, compared to other means of payments. So effectively all the cash paying customers subsidy the electronic payments systems, while not having the convenience of not using cash. This part of the contract is not followed in SEA countries. If you want to pay with something that carries a fee, you are going to pay the fee on top of the price. Logically, most people will choose to pay cash then. The second reason is taxes. Most small vendors do not bother with taxing their incomes; they are too poor for that anyway, every coin helps. With electronic ledgers documenting all the transactions, that would be much more difficult. The local IRSes do not bother with chasing these people, they know that the price would be higher than revenue; so they check only businesses with significant enough turnover.

mcv 6y ago
Cash payments also cost money. Not small interpersonal payments, but for larger shops, storing cash safely, transferring it safely to a bank to have counted and deposit it, costs significant money. Many shops prefer electronic payment for that reason, and voluntarily eat the costs associated with it, because it's still cheaper than cash. Of course that only works if electronic payment is cheap. This is not the case with US credit card companies.
deleted 6y ago
[deleted]
lotsofpulp 6y ago
>One reason is, that cashless transfers costs money; e.g. the card processing companies in their contracts disallow the vendors to increase the prices for customers using their payment system, compared to other means of payments. So effectively all the cash paying customers subsidy the electronic payments systems, while not having the convenience of not using cash. In the US, credit card surcharges have been legal for many years: https://www.thebalance.com/credit-card-surcharges-315423 https://www.thebalance.com/credit-card-surcharges-315423

netsharc 6y ago

They were booming when I visited last year. Each vendor would have 3 or 4 devices, for each different WeChat-esque network. The networks want that sweet sweet marketshare, so they work (pay?) the vendors to have special deals like "10% off your total if you pay with $PAYMENT_APP". I think it's basically the Uber model of spending VC money to subsidize customer purchases to get that market share...