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Why China’s Payment Apps Give U.S. Bankers Nightmares

By PaymentsJournal
May 23, 2018
in News
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Apps super, China payment apps, Mobile Payment Platforms Trends, Mastercard QR payments bot, financial apps

“What’s the average mobile app development cost”, sounds familiar enough? The questions seeking the exact cost to create an app are always on the top searched charts and undoubtedly the topic business owners are most curious about! Whatever be the case, it’s always the payments & costings which can shift a user’s choice. So, let’s come straight to the point, the costings entirely depends on what you choose and how you want your app to be! Well, this may have raised a string of more questions than actually providing a promising answer. Honestly, there can be a few questions which need to be self-worked upon before searching out for the company who can offer you what’s required in the lowest possible costing. Mostly newbies willing to develop an app for their business have either a question of how much money is required to develop a mobile app or what does the pricing depend upon? On the various websites claiming to provide accurate costings may somehow end up as a marketing move just attracting customers and selling their services. To be precise, the app cost may vary from as less as $2000 to as higher as $250,000. This is quite a variation! Well, here comes the role of the factors which determine the highs and lows and bring you the costing more accurate. Here’s a brief list of factors which can be in your bucket as the basic questions required to ask- • Type of company you’re choosing • Company’s location • Complexity of features • The chosen platforms • Designing complexity • Features options There are a lot more subheads beneath everything mentioned here in the list, let’s explore the factors separately and check out the best possible option for your mobile app development- Hiring an App Development Company vs Freelancers There can be a choice from choosing an app development company or hiring a freelancer for your work. Though either of the options is good depending upon their own perks and holdbacks. If you wish to choose an app development company you would have choices from a startup, a mid-level company and an experienced company whichever suits your requirement. Never confuse the high costs with quality products and the low costings with low quality work. You need strong research about the company and their genuine reviews to trust on. Choosing an app development company may bring certain perks- • Trustworthy bonds • Assured quality deliverables • Variety of services at a single place • Schedule blueprint and support • Accountability • Complete project management There is an entire stack of advantages of hiring an app development company while having quite a few disadvantages including higher rates and more bureaucracy but, that might not be an issue if you’re backed with strong research, analyzing the varied factors affecting app development. If you wish to choose freelancers, the biggest perk can be lesser costings as they work independently without having the investments done in infrastructure or backed with a team helping out. You may not also be troubled in making regular communication because you just a single point of contact and that may bring you better support at the times you wish you enquire about the development or need a few amendments in the current built. While having freelancers at work carry their own disadvantages which may help you firm your decision over the choice of either of the options. • Need separate freelancers for different services • Freelancers are working as per their availability, not having accountability to attend your queries 24/7 • You may not be sure about the quality of service as there are no reviews or research options available • Limited transparency • No team backing for support as a single person is working as per his best of skills The biggest holdback why you might not prefer having freelancers working for your project could be different developers working separately. The involvement of multiple developers can be tough to handle, their schedules, working style, communications skills might differ and when it comes to professional app development you are required to have a team working collaboratively for a single project. The crux is to figure out the cost to create an app in both cases, hiring a decent app development company may cost you around $25 per hour, which can surely vary company to company and the features you wish to have it in your mobile app. While in case of having a decent freelancer at work may cost you somewhere similar, it can be lesser though, but you might not wish to take risks in terms of work quality. Again, the choice varies as per the customizations you require to have in your mobile app! Location & Features You may have not considered location as a major factor in cost to create an app but, to your surprise, it can be one! The most preferred locations for mobile app development are- North America, Latin America, Eastern Europe, Australia and the region of Asia (where India is a part). Every region listed here has its separate costing pattern which terms North America as the most expensive one at $150 for IOS and $168 for Android development per hour. Decreasing to Indonesia with the least costing of around $11 for IOS and $12 or android. The costings may still vary as per the company you’ve chosen. Talking about the features, your app’s complexity defines the timeframe of the development this simply means that more you need the complex features to be included, higher would be the completion tenure and the costing. The average tenure maybe 2-4 months in case of basic app development, 5-7 months in case of medium features and design of larger complexity and lastly 9+ months in case of large complex applications with customized designing and development. You can calculate the costing as per the hours spent and the timeline consumed. IOS or Android Choosing the platform, you need your app to work on is a crucial decision. Finalizing on this requires deciding upon your target audience and get on working accordingly. Always keep in mind the market share of both the platforms, there are fewer devices that run on IOS than on Android and this is the reason why it is more complicated to develop an Android app that works equally well on all Android devices. Another factor to be kept in consideration is developing a native app or a cross-platform one, while we prefer to always go for a native one as it’s a better choice for the long run. Developing apps separately for both platforms involves higher costing in comparison of developing cross-platform apps compatible for both. It depends if you wish to go for quality or the lesser price! A quality app is able to produce a great return on your investment. Have into consideration what suits your pocket and choose the best!

The rapid rise and dominance of China’s payment apps, such as Alipay and WeChat Pay, sent ripples of concern through the U.S. banking industry. These platforms, with their advanced features and extensive user base, have revolutionized the way transactions are conducted in China, leading U.S. bankers to rethink their strategies and consider the potential implications for their market.

The Dominance of Alipay and WeChat Pay

Alipay, launched by Ant Financial, and WeChat Pay, a service of Tencent, have become ubiquitous in China, handling billions of transactions daily. These apps offer a seamless and integrated payment experience, allowing users to pay for virtually anything, from groceries to utility bills, with just a few taps on their smartphones.

Eric Jing, CEO of Ant Financial, commented: “Our goal with Alipay is to provide a comprehensive financial solution that meets all the needs of our users, making payments simple, secure, and accessible.”

Advanced Features and Integration

One of the key reasons these Chinese payment apps are so successful is their integration of advanced features and services. Beyond basic payments, they offer:

  1. Seamless Integration: These apps are integrated into various aspects of daily life, including shopping, dining, travel, and even social interactions.
  2. Financial Services: Users can access a range of financial services, such as loans, investments, and insurance, directly from the app.
  3. QR Code Payments: The widespread use of QR codes for transactions has made payments quick and easy, even for small vendors and street merchants.
  4. Super App Ecosystem: Both Alipay and WeChat Pay function as “super apps,” combining multiple services and features into a single platform, enhancing user convenience.

Martin Lau, President of Tencent, explained: “WeChat Pay is more than just a payment service; it’s a platform that connects people to a wide array of services, creating an ecosystem that simplifies their lives.”

Impact on U.S. Bankers

The success of these Chinese payment apps has raised concerns among U.S. bankers about the future of traditional banking and payment systems. The fear is that these advanced, user-friendly platforms could disrupt the established financial services market if similar technologies and business models gain traction in the U.S.

Mary Thompson, a financial analyst, noted: “U.S. banks are worried because these apps offer a level of convenience and integration that traditional banking apps currently do not. If consumers start demanding similar features, banks will need to innovate quickly to keep up.”

The Push for Innovation

In response to the growing influence of Chinese payment apps, U.S. banks and financial institutions are increasingly focused on innovation. They are investing in technology to enhance their digital offerings and improve the customer experience. Key areas of focus include:

  1. Mobile Banking Enhancements: Developing more sophisticated mobile banking apps with integrated financial services and user-friendly interfaces.
  2. Contactless Payments: Expanding the use of contactless payment technologies to streamline transactions.
  3. Partnerships and Collaborations: Partnering with fintech companies to leverage their expertise and accelerate the development of new payment solutions.
  4. Data Security and Privacy: Ensuring robust security measures to protect user data and build trust in digital payment platforms.

Jamie Dimon, CEO of JPMorgan Chase, emphasized: “The rise of Chinese payment apps has highlighted the need for continuous innovation in our industry. We must adapt and evolve to meet the changing expectations of our customers.”

Conclusion

The dominance of payment apps in China presents both a challenge and an opportunity for U.S. bankers. While these platforms have set a high bar for convenience and integration, they also offer a blueprint for the future of digital payments.

As U.S. banks work to enhance their digital offerings, the influence of Chinese payment apps serves as a powerful reminder of the importance of innovation in the financial services industry. By embracing new technologies and focusing on the needs of their customers, U.S. banks can navigate this evolving landscape and continue to thrive.

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