Digital Currency’s Dominance over Two PlatformsDavid Kemp
The Chinese system that all banks employ is likely to implement the country’s digital currency so that the dominance of other platforms would be less distinct. From now on, the sector dealing with digital payments will look and feel different for several reasons.
According to local news reports, the state’s institutions are ready to utilize its digitalized system called in order to reduce the control and weaken the dominance of world-famous technology corporations. Many participants believe that both Tencent s one of such examples. Of course, Alibaba has also been dominating the sector focusing on digital payments for too long and the country wants and needs transformation. Professionals refer users to thereports made by various news agencies, including the Financial Times.
At the same time, it’s essential to point out that the executives and numerous groups involved in the regulatory procedures of the two previously mentioned groups used their influence to decrease competition in the industry. There are plenty of discussions where numerous parties are analyzing the consequences of the state’s actions against WeChat Pay. What official intend to do to Alipay may bring lots of change. At present, the platforms’ financial subsidiaries control the greatest part of the digitally made payments occurring in many parts of the country.
However, the fact many pay attention to is that banks cannot take part in the competition. All realize that this would leave the members far behind. Official representatives claim that the bank is trying to level the playing arena. The Financial Times reveals more details and describes the strategies that the bank employs. Hopefully, the DCEP will find it possible to provide all banks with similar opportunities in the sector of digital payments.
They have gained this sort of experience while doing the same to technology giants. Leveraging digital payments is an important change. Specialists state that the system wants to start leveling the field for the banks. Alibaba and Tencent are the two giants that dominate over retail payments. Unfortunately, banks seem to be much less active in e-payments.
Competition between Several Parties
There might be some sort of fight between the country, WeChat Pay, and Alipay. The mentioned companies were a very active element of the digital currency project. Nevertheless, a few weeks ago, a report announced that these two firms were not listed and included in the list of members.
Professional analysts suggest that the DCEP cannot act against the two brands. Instead, they should integrate them into the system – this will provide smoother and faster digital payments. Mass media outlets say that the country was going to launch its e-currency and use it as an alternative for WeChat Pay and Alipay. Officials state that both brands might have a few patents on the country’s e-currency. As we may expect, this means that Alipay is not yet fully out of the process.
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