Is the central bank's "suspension order" useless? WeChat is pushing QR code payment again

Recently, after WeChat updated to version 1, it added a number of new functions, such as searching for public accounts, identifying QR codes in pictures, and receiving money face to face. The most prominent of these are the "transfer to friends" and "receive money face to face" functions in WeChat's "wallet" and "transfer" functions; the former can realize transfers to WeChat friends, while the latter can realize the "receive money" function by scanning QR codes, which is equivalent to restarting WeChat QR code payment.

"The latest WeChat version is currently only updated on iOS, and the Android version will be updated later." A Tenpay business manager told reporters, "The function of the payer scanning the QR code through the personal account terminal to obtain payment information and seamlessly link to the payment page has been realized in WeChat payment before; the biggest difference in face-to-face payment is that the payer's function of generating a QR code containing payment information is also embedded in the personal WeChat account terminal."

According to the reporter, WeChat's original QR code payment for offline merchants was overall managed by the Tenpay team, including merchant layout and marketing as well as the online payment system, and the WeChat team provided the WeChat payment interface. In the first half of the year, Tencent adjusted its structure and established the WeChat Business Department, integrating the basic business, open interfaces, payment and other businesses on the WeChat platform into the WeChat Business Department. This time, the "face-to-face payment collection" is overall managed by the WeChat business group team.

"They (WeChat Business Unit) have formed a special WeChat payment team. They will be responsible for the development and promotion of WeChat payment business in the future. Tenpay will only be responsible for the backend payment system support. The dominant relationship is exactly the opposite of before." said another person from Fortune.

As for questions such as whether WeChat's continued launch of the QR code payment business has obtained the approval of the central bank, whether the original offline QR code payment business led by the Tenpay team will continue to be promoted, how it will complement and coexist with WeChat's "face-to-face collection of money" business, the latter's positioning and future promotion plans, and whether it will be promoted to merchants, WeChat Pay officials said that the business has just been launched and refused to respond to reporters with more information.

O2O closed-loop payment chain shortened

For the same QR code payment, two development teams within Tencent created two different models.

In the WeChat QR code payment model of Tenpay, offline payment merchants have dedicated terminal equipment to generate QR codes, and agents conduct offline marketing. In other words, in "face-to-face payment", the dedicated terminals of offline merchants are also replaced by mobile WeChat accounts. "In the past, it was specifically for merchants, but now it is all for individuals. The 'individual' here corresponds to the WeChat personal account one by one, and the WeChat payment account, bank card and payment system are seamlessly connected behind it." said the head of the Tenpay business.

"The WeChat team is obviously close to users. For users, the new model is more convenient. Tenpay is more inclined towards financial business and pays more attention to risk control. Of course, it will be subject to some constraints. Except for using 'scan code' instead of 'swipe card', the payment process of Tenpay's QR code payment has not changed much from the offline card swiping model of UnionPay. Even the offline merchant promotion is based on the traditional agency method." A third-party payment person told the 21st Century Business Herald reporter.

The third-party payment professional who came from a bank background took the transformation of the bank's micro-business as an example to further explain the WeChat "face-to-face payment" QR code payment model: "Traditional micro-enterprise loans are operated in accordance with corporate loans, including pre-loan review and loan disbursement process standards, which are relatively cumbersome. Later, it was done in a retail way, directly disbursing loans to micro-enterprise owners, and the process and efficiency were improved. In the promotion of QR code payment, if offline merchants are mapped to personal WeChat accounts, many things will go more smoothly."

He believes that if WeChat's "face-to-face payment" is promoted to offline merchants, it should be positioned for small retail merchants and small payments, "because the personal attributes of small merchants are stronger than corporate attributes."

In fact, compared with the offline QR code payment mode of Alipay and Tenpay and the QR code payment mode that has not yet been commercialized by UnionPay, in addition to the shortening of the payment chain, in the O2O link of WeChat's "face-to-face payment" QR code payment, the scanning link that only reflects the payment information is offline, and the online level is higher. In addition, the target is individual users, so the cost of promotion and marketing is lower and the efficiency will be higher; however, the fact that both ends are facing individual users will also make WeChat's profit margin smaller.

"There is no need to consider profitability. As long as we attract users, there will be room for profit," the head of Tenpay told the 21st Century Business Herald. "The 'face-to-face payment' function has just been launched. The current application scenarios are more about transfers between individuals. We have not yet considered promoting it for offline 'merchant-consumer' application scenarios. The future will be determined by market changes. Tencent's consistent thinking is that if there is market and user demand to drive product upgrades, anything is possible."

Is the central bank’s “suspension order” ineffective?

Since the suspension of QR code payment services in March, although the central bank has not made any statement on "whether to restart and how to restart", all parties have been undercurrents in view of the changes in payment experience and the consideration of seizing future market opportunities.

In response to the QR code payment model of Alipay and Tenpay, UnionPay has developed a QR code payment model based on the traditional offline payment system after several months of hard work, replacing "swiping the card" with "scanning the code", but its scanning process is opposite to that of Alipay and Tenpay, that is, the consumer's mobile terminal generates a QR code of bank card information, and the merchant completes the fund information transmission and payment after scanning the code. Although the technology and equipment are mature, the UnionPay QR code model has not yet been commercially promoted due to the lack of "release permission" from the central bank.

It is understood that Postal Savings Bank officially launched QR code payment nationwide in early August, and its Guangzhou branch has launched a phone recharge service. After media reports, due to the central bank's "suspension order", Postal Savings Bank responded that "QR code payment is currently only being tested within Postal Savings Bank and has not yet been made available to customers."

WeChat's "face-to-face payment" service has once again launched a QR code payment service. When reporters tried to interview WeChat Pay on questions such as "whether they had reported to the central bank in advance and whether they had obtained permission from the central bank when launching the service", WeChat Pay officials refused to respond.

"The essence of 'face-to-face payment' is payment by scanning a QR code, which should be reported to the regulator in advance. Otherwise, according to the central bank's previous instruction to 'suspend QR code payment', it would be clearly contrary to the regulator's will." The above-mentioned third-party payment person told reporters.

According to the reporter, after the suspension of QR code payment, parties including Alipay and Tenpay have already had positive communication with the central bank, the Payment and Clearing Association and other regulatory authorities, and have begun to discuss and formulate relevant payment and security standards. In other words, it is only a matter of time before QR code payment is restarted, but the central bank has not yet made a public statement on this.

The central bank previously suspended QR code payments due to concerns about the security of this new payment model, mainly including the security of the payment system and the security of the QR code information itself and the scanning process.

The payment and clearing system of WeChat's "face-to-face payment" QR code payment is based on Tenpay's payment system. According to Tenpay's previous business processes, if the payment scenario is only "person-to-person", it will not bring new payment security vulnerabilities; its greater security concerns lie in the QR code information itself and the scanning operation. The QR code generated online, in addition to whether the payment information itself carries other virus information, will also be transmitted to the payment account system through scanning.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.