Hong Kong taxi drivers turn to the cashless society

Mobile payment services have been rolled out to taxi drivers and passengers in Hong Kong. The worries about not having enough change or having to carry a large amount of cash are apparently a past issue now.  To achieve this milestone towards a cashless society, MasterCard partnered with HKTaxi, a local taxi-hailing app, to offer this innovative payment system for taxi drivers and passengers. On a parallel note, Alipay and WeChat Pay HK have also jumped into the taxi market, making an aggressive marketing to grab their share. All are ferociously competing to lure thousands of taxi drivers and passengers in the city.


Booking a taxi without cash

Bygone are the days when taxi drivers and passengers had to fret about not having enough change or about having to keep much cash handy. At the same time, taxi drivers can avoid security risks such as thefts or obtaining counterfeit bank notes. Passengers, on their side, can have peace of mind of not having to carry many coins and to fiddle through their wallets for every ride.

The new service offered by MasterCard and HKTaxi allows passengers to book a taxi from the application without involving any cash payment. Since MasterCard is renowned as one of the largest and most reliable payment processors in the world, the new service is equally seen as reliable in terms of security. To attract Hong Kong passengers massively, e-coupons were also offered. This cashless taxi system is furthermore considered as very convenient for tourists as taxi remains a key preoccupation for the latter in a foreign country. HKTaxi claims that its application has been downloaded over 1.2 million times and that over 45,000 taxi drivers have already signed for its service.

WeChat pay and Alipay are also in the race

To become more customer-friendly and offer an array of payment options to passengers, taxi drivers are avidly embracing the cashless option, putting an end to the decades-old cash-only taxi service. Apart from the service offered by MasterCard and HKTaxi, WeChat pay and Alipay are the two other e-payment giants that have decided to invest in the taxi market. Already, over 2,500 taxi drivers have signed up to their cashless services.

Experts consider that WeChat pay and Alipay may rapidly impose themselves as the leaders in this market as, up to date, their services are free of charge yet with various incentives. The Association of Taxi Industry Development, on its side, share that such convenient payment methods are most welcome. They are poised to bring about a number of benefits to the industry as the e-payment behemoths are meticulously trying to cover all areas such as short-runs, airport taxis, and cross-border travel as well.

Numerous incentives are being proposed to lure more clients

While it is obvious that the taxi industry has taken off towards becoming a cashless market, the e-payment competitors now have to ferociously compete with each other to grab the lion’s share. To achieve this end, the service providers are offering numerous incentives. Alipay, for instance, is offering to promote certain fleets via its multiple mainland networks. By introducing the fleets to tourists, taxi owners and businesses can hope to expand their mainland customer base.

WeChat Pay HK, on its side, decided to post ads on some taxis as an incentive to lure more taxi drivers. It also offered HK$ 400 as cash incentives to the latter. WeChat Pay HK is, all the same, relying on this already large and expanding customer base to impose itself as a leader in the taxi industry too.

Local provider Octopus is lagging behind

Amidst this highly competitive landscape, the local e-payment giant Octopus has been overshadowed. The company equally offers cashless payment options to taxi drivers and passengers but the fact that it charges 1 percent of all payments as the administrative fee has made it less appealing. The payment technology adopted by Octopus is similar to the one used by its rivals Alipay and WeChat Pay HK, that is, a QR code service aiming taxi drivers and small merchants too.  

Mobile payment is on the rise in Hong Kong

The QR code payment system only requires a smartphone to scan the driver’s code for payment of fares. As a result, drivers do not have to install any kind of terminal or hardware in their vehicles. QR codes are massively used for mobile payments in Hong Kong, thus seeming as a natural option for both passengers and drivers. Overall, the 2017 Mastercard Online Shopping Survey revealed that the use of mobile phones for payment continues to rise in Hong Kong, with 44.3 percent of respondents having to use their mobile phones for transactions. 

Article published in EMV and Smart Payment Cards :

 

 

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