Is Traditional Payment Substituted By Mobile Payment?

Mobile payment in China has been surging ever since 2013,far surpassing many developed countries.This paper uses the bank card transaction data of 115 cities in China to study the substitution of mobile payment for bank card payment.The study finds that mobile payment has a substitution to bank card payment,but different industries are affected differently.In industries in which transactions are low-value and highfrequency,bank card transactions are significantly affected.While in industries in which transactions are high-value and low-frequency,bank card transactions are almost unaffected.The reason lies in the different choice of consumers between security and convenience of payment.Consumers choose convenience in low-value transaction scenario while security in high-value transaction scenario.Therefore,mobile payment will replace existing payment methods in low-value transaction scenario but will not in high-value transaction scenario.