Lived in China for 6-7 years now and would agree with several of the previous posters in response to the OP. In essence, the "foreign market" (i.e. tourists + foreigners living in China) is just so much smaller than the main Chinese market, so any accessibility for the "FM" is likely to be tacked on rather than fully integrated into the system. I can't see much of these issues being resolved for tourists, although the government could help those working in China by providing an ID card which would work as verification ID like a citizen's ID card.
To add/supplement some points:
- Both Alipay and WeChat wallets work mainly by having users link their bank account(s) to the service. There are two other methods. One is to get someone to add you to WeChat and then transfer money to you. You could also (at least a few years ago) buy credit at post offices (think something akin to an iTunes card) which you can then add to your account.
- I might be a little sheltered up in the northeast, but I've never had any clerk kick up a stink, let alone refuse, paper money as a means of payment. Faster most of the time too compared to waiting for some idiot to find the right section of the app to pay for something.
- Picking up train tickets has become much easier since the automatic ticket machines came in for ID card holders. The main group of Chinese people who still queue up the old skool way are people who don't have or can't use a computer.
- One issue with using WeChat wallet/Alipay overseas is that I can't! I suspect this is due to currency controls. The main issue with this in the past was that foreigners can only buy US$500 (or equivalent) using RMB per day. It would be nice if they at least applied this in some way to WeChat/Alipay rather than blocking my attempted purchase of an iced coffee in Singapore.
-Particularly agree with 889 about the difference for sellers with WeChat/Alipay compared to Visa/MC in the west. In Australia, the banks and MC/Visa run the rort manage the system to their own benefit. High fees and setup costs are the norm, especially for smaller retailers who don't have the market power to fight back. In China, a guy selling roasted sweet potatoes on the street corner just needs a WeChat account (like nearly everyone else in China) and maybe ¥2 for printing out a QR code and maybe splashing out on laminating it. Transaction fees are also far lower than in the west. Electronic payments are more widespread in China because it essentially costs nothing for both sides of the transaction.