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01/06/2021

U.S. government bans Alipay, WeChatPay payment apps

Dan Berthiaume
Senior Editor, Technology
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President Trump has signed an executive order which will prevent the use of eight Chinese payment applications in the U.S., including the popular Alipay and WeChatPay apps.

The order, issued Jan. 5, bans U.S. transactions from being performed with eight Chinese payment software platforms: Alipay, WeChatPay, QQ Wallet, CamScanner, SHAREit, Tencent QQ, VMate, and WPS Office. According to the order, the collection of bulk user data, including sensitive personal information, could advance China’s economic and national security agenda at the expense of the U.S.

In particular, many North American retailers accept digital payments via the Alipay and WeChatPay apps, which have over 2.1 billion combined active users and are popular with Chinese tourists and nationals making purchases in the U.S. and Canada. Payment gateway SnapPay introduced facial recognition payment technology for North American retailers to accept payment from Alipay and WeChat Pay in October 2019. Major retailers including Walgreens and Guess accept Alipay, while chains including Birks Group and Sleep Country Canada accept WeChatPay.

In December 2020, a federal judge denied a request from the Trump administration to ban the Chinese-owned TikTok social media app in the U.S. based on similar concerns over national security.

The order does not go into effect for 45 days, and instructs the secretary of commerce, attorney general, and director of national intelligence to develop specific recommendations for what transactions should be prohibited. By the time the order goes into effect, former Vice President Joe Biden will have taken office as president, and he could revoke it via executive order. The Chinese government has formally criticized the action as going against fair competition.