May 18, 2006

Beijing and Shanghai

I took some time off on Sunday afternoon in Beijing and walked around the Forbidden City along with lots of other out of town visitors. No, don’t even try to find me in the picture, I was behind the camera.

We found that bankers are facing the same problems here as many other places in the world, with strong regulatory pressure on interchange and a high merchant preference for cash, causing merchants to discourage card usage. The same perceived benefits of cash over cards are present here, i.e. that cash is free and cards are not, that merchants can use cash immediately whereas they have to wait for funds when they accept plastic, and that cash is harder to tax. Nothing new in all that, except that these perceptions are probably stronger here than other places I have been to.

Finishing up today in Shanghai with a talk at the China Cards & Payments Conference. My talk is titled “Bank Case Studies: Encouraging Card Usage With Merchant Incentives”. What else?

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