A unit of Chinaโs central bank admonished new retail supermarket Hema for not accepting cash payments, highlighting the countryโs increasing reliance on digital payment channels.
Consumers complained to the Shanghai branch of the Peopleโs Bank of China (PBoC), saying that the Alibaba-owned chain had refused their requests to pay in cash, reports Shanghai Securities News (in Chinese). Officials confirmed the claims after an investigation and requested Hema allow consumers to make cash payments.
Typically, users of Hemaโs app are asked to provide details of their Alipay account or link their bank card to pay for Hema purchases.
Hema told TechNode that the company has established cash payment windows in all 100 of its stores as required by relevant laws and regulations.
This is not the first time the company has been accused of refusing cash. Chinese shoppers started to complain about its branches only accepting Alipay payment last year.
As Chinese tech giants promote the idea of โNo Cash Societyโ, the criticism points to the growing concern amongst regulators, regarding mobile payment methods being too prevalent.
In an official announcement released in July, PBoC reasserted the renminbi as the countryโs legal currency, and therefore no business entity or individual can reject cash payments. As a consequence, local branches of the PBoC have been cracking down on and censuring companies that donโt accept cash.
The PBoC said that it encourages the growth of different payment methods, not only to support new retail businesses but to ensure that consumersโ freedom of choice is respected. It added that as a model of new retail businesses, Hema should serve as an example of inclusive development with multiple payment methods.
Hema has expanded rapidly since September. According to Alibaba, On Nov. 11, Hemaโs 2018 Double 11 sales volume surpassed its 2017 total in just two and a half hours. As of Nov. 30, the company operates 100 stores nationwide.
However, its operations have not been free from controversy. Last month, employees at one of the companyโs Shanghai stores were caught switching expiration dates on vegetables to make them seen five days fresher. The chainโs Shanghai manager was subsequently fired.
At Alibabaโs Investor Day in September, the company described Hema as the โpathfinderโ of the giantโs new retail business. According to Hema CEO Hou Yi, the daily average sales at stores that have operated for more than one and a half years exceeds RMB 800,000 ($ 116,200).
