China is seeing a massive shift towards digital payments, with more consumers opting to send money digitally instead of stuffing cash in red envelopes.
Since the introduction of digital red envelopes, the market has reportedly seen 903 percent year-over-year growth, as most consumers give up the traditional style for speed and convenience.
This year, the digital momentum is being powered by mobile messaging platforms, like Tencent's WeChat, which processed 32.1 billion red envelopes sent through its platform for the Chinese Lunar New Year by over 516 million users, according to Tencent. Over 92 percent of those senders were reportedly between the ages of 20 and 29.
“I sent dozens of red envelopes to my friends, classmates, colleagues and relatives and got more of these back that I could not remember the number,” said He Huiyan, a Guangzhou-based bank clerk, told South China Morning Post.
Now, with a 200-yuan limit, senders are also starting to find their use outside the traditional gifting purposes, with many using them to purchase movie tickets, air and rail tickets and even pay for Didi Kuaidi rides.
“The adoption of Weixin Pay [WeChat] and QQ Wallet was initially driven by consumer-to-consumer transactions, such as red envelope gifting and money transfers, and now, increasingly, expanded to commercial payments, such as utility bills, online-to-offline [local services] and eCommerce payments,” according to a Barclays report.
Alibaba's Alipay also saw a surge in sales of digital red envelopes, with its 400 million users buying 800 million yuan worth of red envelopes this year.
