China’s payment system: Revolution, evolution, or passing fad?

More than 50 years ago, a group of restaurants and frequent diners in New York City came up with an alternative payment system based on an account and a card. Today, that magnetic-striped card is a globally accepted standard model for payments.

A few years ago, two large companies in China came up with an alternative payment system based on QR codes, smart phones, and accounts that don’t require banks. Is this the next revolution in payments or simply an alternative system for an alternative mode?

On June 17, Aaron Klein, fellow in Economic Studies, released a new report detailing how China’s payment system works, what it means, and what lessons the United States can take away. After the presentation, a panel of experts discussed China’s new payment system.