BEIJING, China—Asia’s two biggest economies are tackling various aspects of payments.
At the People’s Bank of China, Governor Zhou Xiaochuan is predicting that physical cash may one day become obsolete.
Zhou said the PBOC is looking into digital currencies as it pursues faster, cheaper and more convenient payment methods, even as he warned that cryptocurrencies such as Bitcoin – more often used for speculation than payments – don’t serve the economy, Bloomberg reported.
“We must prevent major mistakes that would lead to irreparable losses, so we are cautious," Zhou said. "We don’t like creating products for speculation and making people have the illusion that they can get rich overnight."
“China, once home to the world’s most active Bitcoin exchanges, banned the venues last year amid a broad-ranging clampdown on virtual currencies. Yet the country is still the world leader in digital payments, thanks to the popularity of platforms developed by tech giants Alibaba Group Holding Ltd. and Tencent Holdings Ltd.,” Bloomberg noted.
Meanwhile, Japan's three megabanks are working together to standardize a smartphone payment system using QR codes, aiming to promote cashless transactions already widespread in China and elsewhere.
Mitsubishi UFJ Financial Group, Mizuho Financial Group and Sumitomo Mitsui Financial Group will work out specific plans by the end of March to unify QR code specifications across participating banks, Nikkei Asian Review reported.
The rollout of the payment system is slated for fiscal 2019. The three banks are also looking at establishing a jointly financed company to oversee the system.
Cashless payments will greatly streamline bank operations while the use of QR codes will keep costs minimal for retail outlets that adopt the system, Nikkei Asian Review noted.