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China tech

Pay with your face: 100m Chinese switch from smartphones

Facial recognition technology spreads rapidly at the expense of privacy

A female customer has her face scanned by a face recognition system run by Alipay, the online payment service of Chinese e-commerce giant Alibaba's Ant Financial, at a bookstore in Hangzhou city, in east China's Zhejiang Province.   © AP

GUANGZHOU -- Facial recognition technology is reshaping the way consumers in China pay for their purchases, just as mobile payment has done in the past few years.

At stores, shoppers are increasingly purchasing goods with just a turn of their heads, while commuters "pay with their face" at subway stations.

In a country where mobile payments have spread by leaps and bounds in the past couple of years, some 1,000 convenience stores have already installed a facial payment system, and more than 100 million Chinese have registered to use the technology.

To receive the benefits, however, users need to first register their mug shots with smartphone applications offered by providers of facial payment services. A new regulation was also put in place in December requiring consumers to register their facial photos when signing up with a mobile service provider.

While the rapidly expanding use of facial recognition technology is providing greater convenience for Chinese consumers, many are warning that Beijing is pushing the scale and invasiveness of the country's system to keep watch on citizens to levels that should alarm anyone concerned about privacy and human rights.

Visitors are seen on a screen displaying facial recognition technology at Consumer Electronics Show Asia 2019 in Shanghai.   © Reuters

The Seven-Eleven convenience store chain introduced facial payment technology in May for its stores, mainly in southern parts of China including Guangdong Province. Some 1,000 Seven-Eleven outlets already use the system, which allows customers to make purchases only by having their faces scanned by point-of-sale tablets.

Consumers can use this system just by registering their facial photos with a smartphone application. About 10% of customers at Seven-Eleven stores in business districts in Guangzhou already make purchases with the facial payment system, according to the operator of the chain.

Even small restaurants are resorting to the technology, which is also being used for a growing number of vending machines.

Under the government's facial recognition drive, the software has been adopted so subway stations can let passengers use their faces as tickets.

The new system installed at subway stations in Guangzhou in September has provided for "smooth passage through ticket gates even during rush hours," said a 23-year-old woman who works in the city.

Passengers can go through ticket gates simply by looking at tablet computers embedded atop automatic ticket checkers. They do not have to bring a mobile phone with them once they have registered images of their faces with their smartphones.

Facial recognition ticketing is now also being introduced in other major cities including Beijing and Shanghai. The system is expected to start spreading widely next year.

The value of mobile payments in China is nearing 200 trillion yuan ($28 trillion) per year. But some analysts predict that mobile will be replaced by facial as the payment method of choice among Chinese consumers in two years.

Alipay, the payment app operated by e-commerce giant Alibaba Group, and its main rival, WeChat Pay, offered by Tencent, have been powering the trend. Each of these two mobile payment services boasts some 1 billion subscribers.

New facial payment systems are mostly linked to these apps. Alipay and WeChat Pay subscribers can use the systems by simply registering images of their faces.

Facial payment is even quicker, easier and smoother than mobile payment or fingerprint authentication, as the software does not require any smartphone operation or placing a finger on a scanner.

The trend is also being fueled by a bevy of Chinese AI startups offering sophisticated facial recognition technology, including Megvii Technology, which was founded in 2011.

The company is one of the Chinese AI startups specializing in facial recognition that are unicorns, valued at more than $1 billion. Other leading players in the field include SenseTime and Yitu.

But increasingly, more refined facial recognition technology is also raising fears of a dystopian surveillance state, with vanishing privacy and a high potential for abuse.

In September, Megvii pledged to accept society's supervision over its efforts to protect privacy after it drew public criticism for a viral photo depicting the company's facial recognition-powered classroom monitoring solution analyzing student behavior. The system uses cameras installed in classrooms to closely monitor students' behavior to check, for instance, if they are paying attention.

Chinese media criticized the system for putting too much pressure on students.

Moreover, the Chinese government has the power to obtain any private data owned by companies under the new intelligence law that came into force in 2017. The law mandates that companies in China must provide information they have to the government when national security is under threat.

China has been criticized internationally for using the law to extract all kinds of personal information from businesses. Facial identification technology, if used widely, will help Beijing's efforts to build a network that can closely monitor the activities of all of its 1.4 billion citizens by using a powerful surveillance system supported by 200 million security cameras installed across the nation.

This prospect also has significant implications for the rest of the world. The U.S. and Europe are moving toward imposing regulatory restrictions on the use of facial recognition technology out of concerns about privacy infringement and other human rights violations including racial discrimination.

The European Union's general data protection regulation, which was put into effect in 2018, already prohibits in principle the collection of sensitive biometric data including facial recognition data that can be used to identify individuals.

In the U.S., four cities, including San Francisco, decided this year to restrict the use of facial recognition systems by police and other public organizations. But these moves are unlikely to deter the Chinese government from promoting facial recognition technology as a tool for national security.

Beijing may initially focus on emerging countries under its strategy to export and promote the technology globally.

On Oct. 7, the U.S. Department of Commerce blacklisted a group of Chinese tech companies developing facial recognition and other artificial intelligence technology that Washington says is being used to repress China's Muslim minority groups like Uighurs, particularly in the surveillance-heavy Xinjiang region.

Megvii, SenseTime and Yitu have all been put on the so-called U.S. Bureau of Industry and Security's Entity List.

In Hong Kong, where protests against China have been raging for months, many pro-democracy demonstrators wear masks to avoid being identified and tracked with monitoring cameras and facial recognition technology.

The situation in China apparently heralds an era of ubiquitous facial recognition, when greater tech-supported convenience comes at the cost of privacy. In China, however, the name of the game is "ease to use." There is no particularly strident criticism in the country, at least for now, about the use of the software by the government or companies.

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