WeChat Pay, Alipay Banned In Nepal

WeChat Pay and Alipay, the Chinese digital payment apps, have been banned in Nepal due to a loss of income as a result of the services, per the government’s claims.

Reuters, citing Laxmi Prapanna Niroula, a spokesman for the Nepal Rastra Bank, reported that the two digital payment services are not registered with the central bank in Nepal and are therefore illegal.

WeChat Pay is a unit of Tencent’s popular WeChat mobile messaging platform, while Alipay is operated by Ant Financial, an affiliate of Chinese eCommerce giant Alibaba. These payment apps are used by Chinese tourists who need to pay in Chinese-run businesses in Nepal.

“Any digital transaction made with unregistered foreign payment systems like WeChat Pay and Alipay is illegal,” Niroula told Reuters. “Anyone using such platforms can be punished.” Individuals found guilty of embezzling foreign exchange could face jail time of as much as three years, noted the report.

The spokesman said the apps were using Nepal‘s internet connectivity, but the transactions are being made in China and not in the country’s national accounts. “The government cannot tax such transactions nor check any crimes related to such unregistered payment systems,” Niroula said, noting the ban went into effect at the start of the week.

In a statement to Reuters, Tencent said its WeChat Pay unit meets all regulations in the countries where it operates. “As for illegal payment collection overseas, we are constantly using technical means to crack down and prevent this behavior,” it said. “Overseas vendors should work with WeChat Pay’s partners to enable WeChat Pay’s collection services.”

Meanwhile, Alipay said it also complies with local rules and regulations. “We request that all users abide by the Alipay Collection QR Code Agreement when using our QR code payment services. We have strengthened our measures to effectively prevent future cases where some users had wrongfully collected payments outside of China using domestic QR codes,” it said.

Of the 1.1 million tourists to Nepal last year, 153,000 were from China. They comprise the largest group after Indian tourists, which amounted to 200,000 in 2018.