[Video] How Singapore travellers can navigate cashless payment in China

(Edited and refined by Bai Kelei, with the assistance of AI translation.)

China has become an increasingly popular travel destination for Singaporeans in recent years. The country is now almost a cashless society, and visitors may worry that their credit cards will not be accepted, that they may not have enough cash, or even that they do not know which apps to download. Singaporeans now have more options, from linking their cards to Alipay and WeChat to using Singapore banking apps for QR-code payments. 

Singapore has seen a surge in travel to China in recent years. According to Trip.com data, flights from Singapore to China were the most popular on the platform in the first quarter of this year.

Data from the multi-currency platform YouTrip also showed that, as of the end of July, about one-quarter of Singapore travellers had visited China. This puts China ahead of Japan as the second most popular destination among Singapore travellers.

YouTrip chief operating officer Kelvin Lam told Lianhe Zaobao that the growing popularity in Singapore of Chinese brands such as Pop Mart, as well as Chinese short dramas and social media content, has drawn Singaporeans to China.

China’s cashless ecosystem

How to pay in China has long been a popular topic among travellers. The country’s efforts in recent years to develop digital financial services have made it one of those with the highest adoption rates of digital payments in the world.

WeChat and Alipay are the two dominant digital payment platforms in China. Data from Statista shows that 90% of users in China rely on these two platforms for digital payments.

Ng Zhu Er, 27, a procurement officer who has visited many Chinese cities, told Lianhe Zaobao that electronic payments were extremely widespread in China and that she had not encountered any shops that accepted only cash. “On the contrary, a friend of mine once wanted to pay in cash, but had to give up because the merchant did not have enough change.”

Integrating international networks with local wallets 

A common complaint in the past was that China’s payment systems were not fully integrated with international networks. Some tourists attempting to pay in cash may have received a cool reception, while internationally used credit cards were often not accepted.

However, this appears to be changing as the number of international visitors to China rises. During a visit in August, I found that many hotels, shopping centres and public transport facilities accept international credit cards.

Even so, travellers who want to get around smoothly are still best advised to activate WeChat Pay or Alipay. Non-Chinese citizens, including Singaporeans, can register for these apps using a Singapore mobile number.

Previously, foreign visitors without a Chinese bank account could not top up digital wallets linked to these apps through bank transfers directly. To make things easier for foreign visitors, WeChat and Alipay began supporting international payment cards, including Visa and Mastercard, from 2023.

However, users should note that when making payments directly with an international card, these digital wallets charge a 3% fee on each transaction above 200 RMB (about U$30).

Youtrip’s Lam suggested that in such cases travellers ask merchants whether they can pay directly by card to avoid digital platform charges. But when international credit cards are used, it is worth noting that non-Singapore-dollar transactions generally incur a 3.25% foreign currency processing fee.

Cross-border fintech expansion by Singapore banks 

Besides using international credit cards directly, customers of Singapore banks such as DBS and OCBC can now top up their WeChat and Alipay digital wallets through remittances made via their banking apps. Previously, this function was available only to WeChat and Alipay accounts registered by Chinese residents.

However, from 5 June this year, DBS started allowing its customers without Chinese passports to remit funds directly to their WeChat accounts through its banking app. Customers need only upload a copy of their passport to WeChat for identity verification before they can receive remittances through the mobile number linked to their WeChat account.

Lim Ping, DBS’s regional head of ecosystem and cross-border payments for consumer banking, told Lianhe Zaobao that the service was well received within a month of its launch. Since then, the number of customers using the service has quadrupled, with customers in Singapore accounting for 60% of users.

OCBC is also preparing to extend its remittance service to international WeChat and Alipay users, with the bank planning to launch the function in the third quarter of this year.

This being the case, topping up digital wallets through remittances when exchange rates are more favourable may offer some savings instead.

Banking apps make China payments easier for visitors

In recent years, some Singapore banks have partnered Chinese payment platforms to offer digital payments through their banking apps. Customers can use their Singapore banking apps to scan QR codes and pay in China.

Among Singapore’s three major banks, OCBC’s digital app is the only one that supports all three major Chinese payment platforms. For Alipay and UnionPay, users can both scan merchants’ QR codes and generate QR codes for merchants to scan. For WeChat, the app supports only QR code scanning by merchants. OCBC said Alipay is the most popular of the three payment platforms among its users.

The DBS PayLah! app, widely used by Singaporeans, also supports payments through scanning or generating UnionPay QR codes. Lim said transaction volume for this function grew 40% year on year. DBS is also understood to be in discussions with TenPay Global and Ant International to enable PayLah! users to scan WeChat and Alipay QR codes directly for payments.

The advantage of paying directly through the two banks’ digital apps is that funds can be deducted directly from users’ Singapore bank accounts, without the need to download additional apps. This is especially useful for visitors making short trips to China and spending only at physical stores.

Appeal of digital wallets 

Users should note that transactions made through services offered by Singapore banks in partnership with Chinese digital payment platforms may involve an exchange-rate markup to cover fees and administrative charges for foreign currency transactions. So it is advisable to check the actual Singapore dollar amount displayed on screen and compare options across platforms before transacting.

During my time testing these services in China, I found that payments made through Singapore banking apps sometimes failed because of network issues or took too long to process. Moreover, the banking apps generally support payments only to merchant QR codes, which are intended for businesses, rather than personal QR codes. This means users may not be able to pay smaller merchants or self-employed vendors.

Compared with using Singapore banking apps to make QR code payments, directly topping up WeChat or Alipay digital wallets through remittances offers substantial advantages, including the ability to make in-app payments across a range of digital apps.

DBS’s Lim said, “After topping up their wallets, customers can seamlessly use China’s highly digitalised ecosystem for transportation, food delivery and other everyday services.”

For instance, users who want to rent powerbanks, book a ride or order food delivery in advance through WeChat mini programmes can pay directly with their account balances.

Another advantage is that WeChat users can use their account balances to transfer money or send red packets directly to relatives and friends in China, as well as to other WeChat users. International credit cards are currently not supported as a source of funds for either function.

UnionPay cards as alternative

For those who prefer to use Singapore bank cards for transactions in China, another option is to apply for a UnionPay card.

Among the three major banks in Singapore, DBS and UOB issue UnionPay debit cards and credit cards respectively. When linked to Alipay or WeChat, both types of cards are exempt from the digital platforms’ 3% fee, even for transactions exceeding 200 RMB.

Both banks also offer rebates. DBS offers up to 5% cashback on renminbi transactions, while UOB offers 2% cashback on all transactions.

It is worth noting that, as with most Singapore-issued credit cards, transactions in foreign currencies processed through the UnionPay network generally incur a 3.25% foreign currency processing fee.

As with any credit card rewards programme, users should check the specific terms, cashback rates and fees, and do the math carefully to ensure the rewards outweigh the costs. They may also wish to consider cards that waive foreign currency processing fees.

This article was first published in Lianhe Zaobao as “放下现钞码上消费 赴华游怎样边花钱边省钱？”.

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