Prepare Small Change for Foreign Tourists... China's Retreat from 'Cashless'

Improvement to Allow Yuan Withdrawal with Domestic Bank Cards

China has announced plans to improve the yuan payment issue, which has been cited as the biggest inconvenience for foreign tourists. Amid repeated emphasis on opening up for private and overseas corporate investment, this move is interpreted as a strategy to enhance convenience for foreigners and boost the sluggish consumer vitality. It also shows encouragement for the use of cash, which the government has strategically restricted until now.

On the 7th, the State Council of China released the "Opinions on Optimizing Payment Services and Enhancing Convenience," pledging to significantly improve payment convenience within China. This decision appears to accept criticism that the local payment system, focused on mobile payments via QR code scanning, causes inconvenience for the elderly and foreigners.

[Image source=Reuters Yonhap News]

The State Council stated, "We will prepare age-appropriate global services to enhance convenience in all aspects of mobile payments and optimize excellent communication services and mobile phone number processing procedures for foreigners in China."

In China, most payments for goods and services are processed through phone numbers linked to accounts. Because of this, foreigners visiting China for short-term purposes such as tourism have faced difficulties in hailing taxis or making payments via mobile due to identity verification issues. Another problem has been that credit cards or cash, which are still widely accepted overseas, can only be used very restrictively.

While improving this, the State Council also showed a step back from the core "cashless society" policy that has been central to payment system policies. The State Council explained, "We will continuously optimize the cash usage environment" and "urge businesses in transportation, shopping, entertainment, tourism, accommodation, and other sectors to guarantee cash payments." In particular, it clarified that "refusal to accept cash payments may result in penalties, and businesses must prepare change." This is seen as a measure considering that, due to the rare use of cash, customers often cannot receive change when presenting cash at stores or taxis.

Additionally, it was announced that foreigners will be able to withdraw yuan using their home country bank cards. The State Council emphasized, "We will continuously improve ATM bank card acceptance so that the elderly and foreigners can withdraw yuan using domestic and foreign bank cards."

Furthermore, "In major locations such as large commercial districts, tourist attractions, cultural museums, hotels, transportation hubs, and hospitals, payment methods including mobile payments, bank cards, and cash must be accepted, and the necessary software and hardware should be in place. For locations below a designated scale, conditions for processing should be actively created, and a diverse payment acceptance environment should be jointly established," the statement added.

The State Council stressed, "To better meet the diverse payment service needs of the elderly, foreigners in China, and other groups, we will promote the parallel development and complementarity of mobile payments, bank cards, cash, and other payment methods, further improve payment service levels, and provide better services."

This content was produced with the assistance of AI translation services.