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WECHAT ESCALATES MOBILE PAYMENTS RACE IN CHINA: Last week Chinese e-commerce giant Tencent opened the mobile payments feature within its messaging app WeChat to a wide variety of online and physical merchants, including smartphone maker Xiaomi and vending machine operator Ubox. Users can pay for goods and services directly within the app, and WeChat collects a .6% fee for powering these transactions. The move is widely seen as a direct challenge to Alipay Wallet, which is owned by Alibaba — China's version of eBay and Amazon.
Both Tencent and Alibaba are positioning themselves for a payments war. Alipay has blocked merchants who use WeChat from accessing its API and WeChat has blocked merchants who use Alipay from using WeChat payments.
And the stakes are high. The value of goods purchased with non-bank mobile payments in China is expected to grow from $49 billion last year to about $221 billion in 2016, according to iResearch.
Part of the reason that mobile payments are advancing so quickly in China is that the country is just beginning to develop its electronic payments rails so consumers have no problem skipping credit cards and moving directly to mobile. That's in contrast to the U.S. where most people already have and are accustomed to using a credit or debit card so there isn't a huge incentive to adopt mobile payments. (South China Morning Post)
MT. GOX CEO GETS HACKED: Bitcoin exchange Mt. Gox has been defunct for a number of weeks, but hackers are still enacting vigilante justice on Mark Karpeles who acted as CEO of the exchange. When Mt. Gox filed for bankruptcy it claimed that it had lost 850,000 bitcoins to theft. But hackers have uploaded a message to Karpeles's blog claiming that the exchange actually held deposits of 951,116 bitcoins at the time of the collapse. Which of the two numbers is the real one? It's anyone's guess, but people who used Mt. Gox have come forward to confirm that some of the transactions listed in the data are accurate. (TechCrunch)
In other Mt. Gox news, the defunct Bitcoin exchange has won temporary bankruptcy protection in the U.S. (BBC)
A NEW PEER-TO-PEER PAYMENT SERVICE IN THE UK. The Payments Council — an organization of financial institutions in the U.K. which collaborates to develop payments systems, announced yesterday a new peer-to-peer payments app called Paym. The app will allow users to transfer funds to others using their mobile phone and phone number. The app is due to be released in April or May and will be available to customers of Bank of Scotland, Barclays, Cumberland Building Society, Danske Bank, Halifax, HSBC, Lloyds Bank, Santander and TSB Bank. (Payments Council)
QUOTE OF THE DAY: "We welcome innovation in the payment industry, and to hear that a service we have offered for the past 8 years is becoming an industry standard is great news. For many PayPal customers Paym will be nothing new; with over 18 million PayPal accounts in the UK, users have been able to send money via their mobile since 2006," says a statement from PayPal's Rob Skinner, director of PR PayPal UK and Ireland. (MarketingWeek)
McDONALD'S LAUNCHES MOBILE PAYMENTS IN SWEDEN. McDonald's is integrating mobile payments solution SEQR into its mobile app. The integration will allow customers to make purchases by scanning QR codes generated at McDonald's checkouts. Fast food restaurants are good candidates for mobile payments because they have loyal customers and widespread locations — frequent purchases and accessibility may be enough of an incentive for customers to adopt mobile payments. (Finextra via McDonalds)
FIRST DATA GETS A NEW CHAIRMAN. Payments technology provider First Data named Frank Bisignano as its chairman yesterday. Bisignano already serves as First Data's chief executive officer. Prior to Bisignano, Joe Forehand held the role of chairman. Bisignano was named chief executive officer for First Data in April 2013 and was brought in to help First Data overcome its massive debt burden brought on by a leveraged buyout by private equity firm KKR which took place in late 2007. (First Data)
POLICE WARN AUSTINITES NOT TO USE CAR-HAILING APPS: The Austin police department issued a warning telling people not to use car-hailing services like Uber, Lyft and SideCar. Car-hailing services are not currently legal in Austin, although Uber has sought to offer limited services to SXSW festival goers to get around the regulations. Car-hailing apps have potential to expand into the mobile wallet space in part because they have the credit card information of the people who use them. One of the biggest hurdles for mobile wallet apps is getting people to enter their payment card information on the small screens of smartphones. We'll take a look at car-hailing apps' potential in payments in an upcoming chart. (Austintexas.gov)
BBC: eBay cuts chief executive John Donahoe's pay by 53%.
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