Mobile payments and crime: evidence from China

Using a policy change in 2016 as a natural experiment, we employ a Difference-in-Difference (DID) model to analyse the effects of mobile payments development on crime rates in Chinese prefectures from 2015 to 2019. Our findings indicate that mobile payments expansion has a significant negative effect on theft, with the reduction of residents’ cash holdings serving as a potential mechanism. However, we find no significant impact on non-economic crimes like sexual assault and murder. This study provides evidence supporting the role of policies and technologies enabling mobile payments development in deterring crime and enhancing social security.