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Chinese Red Envelope

Red envelope, also called Hongbao, is a long and narrow red paper envelope written with golden lucky words. It’s a cultural specialty during the Spring Festival. However, Hongbao is given more meaning today. It’s used as gift money, bonus money, tip, bribery, gamble, and gift coupon.

Origin of Chinese Red Envelope

The legend goes that there was a little sprite named “Chong," who was very mischievous. He often came out on new year’s eve and touched children’s heads while they were sleeping. Those who were touched would end up having a fever and becoming dumb. To keep the sprite from hurting children, the parents lit up all the rooms and sat up all night. A new year was coming along, and the little sprite was ready to play again. He went to an old couple’s house and found the cherished baby boy. He was about to touch the boy’s head when a shaft of light appeared. The sprite fled away. It turned out that the old couple placed a small red envelope with eight copper coins wrapped beside the boy’s pillow. It was the envelope with money scared the sprite off. Later, the red envelope became a must during the new year’s eve.
Red Envelope

Why Do Chinese Give “Red” Envelope?

Red, in China, is a color of passion and good luck. Chinese people use red on festive occasions such as birthdays, wedding ceremonies, Chinese New Year, etc. It becomes a tradition to give red envelopes, instead of envelopes in other colors.

How Much Money Should Be Put in a Red Envelop?

It depends on your relationship with the recipient. During the Chinese New Year, children close to you often expect more money in a Hongbao. Chinese people also give Hongbao to older people, and the amount is usually larger than that of the children.
Hongbao is also gift money for brides and bridegroom. Those who are directly related to the new couple are expected to give a big red envelope. For business partners who are invited to weddings, their Hongbao reflects how much they value the partnership.
Besides, companies often use Hongbao as an annual bonus to their employees. There is no specific regulation on how much money should be put in Hongbao. However, most companies won’t give a Hongbao of less than a month’s salary.
Giving a red envelope is a big deal in China. People don’t just put, however much they want. The number of money must be even numbers, like 200, 600, and 800. It’s deemed unlucky to receive a Hongbao with the number 4. Also, in the new year, Hongbao must-have new money. Therefore, Chinese banks are extremely busy making new money at the end of the year.
Red Envelope

How to Give and Receive a Red Envelope?

Giving and receiving Hongbao is serious. You are expected to give and receive with both your hands. In usual cases, Hongbao is not meant to be opened in front of the giver. However, if a Hongbao is given at a wedding ceremony, it must be opened right away so that the ledger clerk could take notes. If the giver is unmarried, he/she shall receive a bigger Hongbao from the newlyweds than that had been given.

Digital Hongbao

Digital Hongbao refers to the online money transfer services that replace the actual red envelopes. Banks initially developed it to transfer money. However, the banks were inefficient in money transfers and didn’t do a lot to publicize Hongbao business. Until the internet giants like Tencent and Alibaba came and snatched the opportunity to promote digital Hongbao.

On Jan.27th, 2014, WeChat Hongbao was launched, and it was a hit. Chinese people began to build groups and snatch Hongbao on Wechat. One person sends a Hongbao and set how many people can grab it. Everyone else can seize. The amount for every snatcher is entirely random. Even if it’s only for a few dimes, people are still excited.

WeChat Hongbao

After the Wechat Hongbao set off, Wechat collaborated with the television studios and launched the campaign of shaking your phone for a WeChat Hongbao. It was a huge success. Instead of watching the Spring Festival Gala, people were excited by the potential prize of the WeChat Hongbao.

Alibaba also created a Hongbao business out of the Alipay, but it didn’t catch up with the Wechat pay until the 2016 spring festival. Alipay launched a campaign of rewarding people with cash by encouraging them to add more people to Alipay and collect the five Fu (Ai Guo Fu, Jing Ye Fu, He Xie Fu, You Shan Fu, and Fu Qiang Fu). It took off instantly and became a tradition every Chinese new year.
Alipay Hongbao

Huge Influence of the Digital Hongbao

Digital payment is prevailing all over China. People are able to pay whenever and wherever they can as long as there is the internet. Tencent and Alibaba are two giants in terms of digital payment. They formed a new business model of attracting users by rewarding them with all kinds of Hongbao coupons. The more people use their payment systems, the more reward they can get. It’s a virtuous cycle.

Five Fu

Today, digital Hongbao is the mainstream, and there is still potential for it. However, the traditional red envelope will not be entirely replaced. It’s more ritual, more personal, and appropriate on the grand occasions. The profound cultural meaning it bears is not something people can throw away.

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