Sphere No.44 (Mar 2018)

PORTS FOCUS Sphere #44 2018 12 Peer-to-peer (P2P) models enable people to make money from money, like bankers. They allow people to borrow and lend to each other directly, but supported by technology that enables people to build credit records through reputation, like ratings on eBay. P2P equity crowdfunding turns people into miniature venture capitalists, allowing them to commit small amounts of equity to new projects. Mobile technology has also eased the problems for societies where credit cards, for whatever reason, never caught on. Only a decade ago, luxury cars and houses in China were being paid for using duffel bags full of cash, as credit cards were not widely used and banking was cumbersome. Now, in many parts of urban China, citizens go weeks without using cash or carrying a wallet. Even beggars will take mobile payment via a phone. In places like Kenya, mobile payments mean farmers who have never had bank accounts are researching distant market prices and cutting deals on their mobile phones. Globally, whole banks are opening that have no tellers and no physical locations. Money itself is changing too. New electronic currencies are trying to do much more than just be a medium of exchange, a store of value or a unit of accounting. Token-based currencies incorporate ‘smart contracts’. Not only can you ‘spend’ the tokens to gain access to a service, but the token itself is a piece of software, encoding the entirety of life’s commercial transactions from utilities to groceries to insurance and daily necessity purchases. Now it has come to Hong Kong in partnership with CKHH in the form of AlipayHK (see next page). With over 1,000,000 people signed up in its first 10 months, it is quickly becoming as pervasive in Hong Kong as in urban China. The next phase in our relationship with money has arrived, with all our funds and the world of purchases at our fingertips. From Lydian Lions to AlipayHK, money is the lynchpin of civilisation that has gone from a lump in our pocket to bits and bytes. While it has become less physically real and is hidden in our phones, it has become more accessible and usable in ways the stampers and shavers of coins could never have imagined. Innovators will continue to make money and credit more accessible, accelerating the pace of progress. The Notorious B.I.G. might have said “Mo[re] money mo[re] problems” but without it, we would be without the civilisation we take for granted every day. So bring on the “Money, Money, Money!” MONEY, MONEY, MONEY >> Now, in many parts of urban China, citizens go weeks without using cash or carrying a wallet. Even beggars will take mobile payment via a phone. information and instructions critical to accessing the service. This is the first time since the Lydian Lion that the essential nature of money has changed to incorporate a new function. Money: more than payment The idea that money can be good for more than its main three benefits is also changing. When combined with a wide array of other services, a payment system can become the lynchpin of a whole ‘super lifestyle mobile experience’, delivered through an app (mobile phone application). Nowhere is this more true than in China. While mobile payment apps in some places have been ‘a credit card in a phone’ – bringing a higher degree of convenience – in China, it is much more. Most Chinese cities seem to have gone cashless. Major fintech companies like Ant Financial have incorporated technology into the financial sector, using their diverse expertise to transform relationships with money through their innovative fintech platform, Alipay. This has become a total lifestyle manager, encompassing almost