Why did third party payments become so powerful today

For a long time, I've never quite understood why third-party payments are so powerful today. There is a reason for this doubt.

My personal experience has five years of import and export trade work. The means of payment in foreign trade are basically "L/C" (c). The principle of L/C is very similar to the principle of Alipay, which is used to solve the problem of mutual trust between the transactions of the long-distance trade: the silver goods cannot be versus at the same point. But my five years of import and export career, I have been confused about one thing: why domestic trade there is no such thing as a letter of credit. Domestic trade also has a considerable amount of trust issues in remote trading.

Banks play an important role in such a long-distance trade as international trade. Never heard of "third party payment", the bank is a third party: the parties to the transaction due to mutual trust needs to pull the third party to do credit guarantee. E-commerce is also a long-distance trade, oddly, the rise of third-party payments. In today's consumer online shopping behavior, whether Alipay, or micro-letter payment, are more popular than the direct use of banking methods. After the rise of the third party payment, even on the basis of its emergence of the so-called network bank, the traditional banks constitute a huge competitive threat. It can be said that the bank's close to the consumer online shopping business, is one of the important reasons for today's situation.

But why didn't the bank do it? It has a long history of letters of credit in international trade, but has been indifferent to domestic trade (most online or domestic). It makes me very curious.

One more thing: credit card (note, not letter of credit), this thing itself is not money, but based on the personal account system of a payment method. The funny thing is that credit cards aren't invented by banks. According to GE in the book Changing America, in 1949, an American businessman forgot to bring his wallet, and after embarrassment launched a "dinner Club" and launched the originator of the credit card: Big Lycra.

Big Lycra is a bit of a shadow of today's third party payments, just offline. Big Lycra has grown to 1.25 million users by 1960. But the bank also acted quickly, and the bank launched its own credit card in 1951, the second year after the launch. But the move did not make the credit card business any better. The main reason is that banks are limited by the policy at that time and can only operate locally.

The real way to beat the big Lycra third party is: the bank's agreement organization. Because banks are limited to local operations, they have to do business across the board (this is a normal scenario: Locals are holding local cards to be consumed in the field). The birth of the visa organization followed the advent of MasterCard. The two credit-card groups have crossed policy limits, and the banks ' own financial system has underpinned the rapid growth of big Lycra as an old-fashioned American.

Back to today's third party payments rise up. I have to say, the bank's past business is too comfortable (in fact, both at home and abroad), they do not have the same geographical restrictions as their predecessors, on the internet, they also want to certainly think their customers will use their own trading means to complete online shopping. When the third party payment tool developed to even the money fund began to do, the balance of treasure is strong, has made it impossible for banks to destroy, can only be there Bundas trembling big talk about the internet thinking.

History can sometimes repeat itself, but it is not a repetition of 100%. The first shot of the credit card was launched by a third party, but the days of being stuck in the Luo shell quickly realised it was a huge business opportunity, and new ways of breaking policy restrictions were created. Today's Third-party payment tools continue to be a third party, but it's a good day for banks to turn this opportunity of the Internet era into a huge challenge. As for the letter of credit mentioned in the paper, will the third party payment replace it? Don't say it's impossible.