We always knew that a thing can’t be both good and free at the same time in this world. Well, one of China’s most popular — and erstwhile free — payments service Alipay will soon charge a transaction fees. The Alibaba backed entity has announced that beginning in October, the service will charge a 0.1 percent fee for transfers from Alipay to personal bank accounts.
Alipay, which has a user base running in hundreds of million of users in China, introduced this change almost one year after the Tencent backed WeChat Pay. Meanwhile, the new policy will take effect from Octiober 12, so that someone who has money in their Alipay account, can still transfer it without any extra charge.
Meanwhile, the platform’s policies with regards to this change aren’t very clear as of yet. From what we have been able to gather, the transaction fees will not apply over transactions “whose accumulated sum” is under US$3,000. Now the question is if $3000 is the limit for fre transactions that can be made from an Alipay account or if it is a monthly limit, to be renewed after each 30-day period.
It’s more likely to be latter, considering that Alipay’s biggest competitor WeChat Pay, also levies a fee on bank transfers that exceed US$3,000 per month.
Meanwhile, users appear to be less than happy about the new changes. While the company has cited increasing operational charges as the reason behind this policy change, users are not convinced — with many stating that Alibaba got millions of users to deposit a whole lot of money into their Alipay accounts by being free and is now going to turn a profit by charging them to transfer the same money to their bank accounts.
Some even went so far so as to compare the situation to a pig being fattened from slaughter. In all fairness to Alipay though, users still have a 1 month grace period and can well take their money out of Alipay accounts. So yes, these accusations appear to be pretty weak.
However, Alipay is definitely looking for another revenue source and a .1 percent fee goes a long way when you have hundreds of millions of users performing millions upon millions of transactions everyday. And unless someone is transferring like a few hundred thousand dollars, they are not particularly likely to feel discomfited. However, the .1 is just the beginning. Now that the platform has finally shed the tag of being pro-bono, there is nothing forcing it to keep to the .1 percent limit forever.
A bibliophile and a business enthusiast.