Alipay, China’s major third-party payment service, announced it will start charging fees, 0,1%, for transferring more than $3,000 (20,000 yuan) to bank accounts, reports Tech in Asia.
Tencent’s WeChat Pay levies a fee on back transfers that exceed $3,000 per month, but it’s unclear if Alipay’s new fees will work similarly, or whether the $3,000 might be a yearly or lifetime limit for free bank transfers.
The new fees regulation will go live on October 12, so users that don’t want to pay the fees have some time to withdraw money out of their Alipay accounts.
Users were upset about WeChat’s fees last year, and displayed similar reaction to the news about Alipay. Users have taken to the internet to comment on the fee surge.
A Zhejiang commenter wrote “so many people put so much of their money into Alipay, even though investing it could make more money. Then Alipay turns around and wants to charge fees!’
Although the logic is quite skewed there, it reflects a lot of the sentiment expressed online.
Alibaba’s explanation for Alipay’s new fees
Alipay’s explanation for the added fees is that its own operational costs have gone up, but users don’t buy it.
Users accuse Alibaba of ‘fattening the pig and then slaughtering it’
This implies that Alipay got users to deposit lots of money by being fee free, and now intends to cash in on that by charging this fee on users who want to take money back out.
Despite the user anger online, the ultimate fallout is likely to be very minimal. A fee of 0.1% is small, and millions of people are already routinely using Alipay. With Alipay’s competitor WeChat charging a similar fee, there’s no viable and obvious alternative for those who want free fees.
A version of this appeared on Tech in Asia on September 13. Read the rest of the story here.