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Chinese, U.S. Firms Expand Mobile Payment Services Internationally

By Mike Faden

China's big Internet companies and their affiliates process the vast majority of mobile payments in China, by far the world's largest mobile payments market.1,2 Now, those companies are taking their mobile-payment services into other countries, while U.S. technology companies also continue to expand the international reach of their mobile-payment technologies. The international expansion of these payment services may provide businesses with new opportunities for cross-border trade.3,4

The moves by Chinese companies have attracted attention in part because of the size of China's mobile-payments market, which analysts estimated at $5.5 trillion in 2016 – about 50 times the size of the U.S. market.5 Two companies account for roughly 90 percent of those payments: Ant Financial, a financial-technology (fintech) company spun out of e-commerce giant Alibaba, and internet firm Tencent, according to market-research firm Analysys.6 Some 40 percent of China's estimated 1.36 billion7 mobile subscribers use mobile payments services at least once a week, according to analyst firm Kantar TNS.8


Payment Services Target Chinese Buyers


One reason for the international expansion is to capture payments by Chinese consumers for foreign goods. Chinese tourists are expected to spend more than US$255 billion abroad by 2025, according to a Forrester Research analyst, so there is a considerable potential in making the electronic-payment services that they already use in China available in the countries where they travel.9 Expansion also may help U.S. and European companies sell to customers within China.10 To achieve these goals, Chinese payment firms are striking deals with payment providers in the U.S. and other countries to enable Chinese customers to buy from e-commerce sites and brick-and-mortar outlets abroad.11 As a result, Ant Financial's Alipay payment service is now accepted in dozens of countries.12


Experts say that Ant Financial, for one, is expanding internationally to fuel broader growth plans.13 The company offers a range of financial services besides payments, including wealth management, insurance, and credit-rating. Many of those services are accessible via its Alipay payment app. Indeed, the company now describes Alipay as a "global lifestyle super-app" used by more than 400 million people to shop online, book travel and pay bills.14,15 The company often works with local partners or forms joint ventures to enter new countries so that it can launch financial-services offerings that are tailored to local users, according to reports.16


While mobile-payment services in the U.S. typically use near field communication (NFC) wireless technology to communicate with point-of-sale terminals, Chinese firms' payment technologies can identify buyers and sellers by scanning QR codes. This helped them gain wide acceptance in China because it means retailers don't need to invest in relatively expensive NFC-based terminals.17 Apple Pay, in contrast, has not gained significant market share in China, according to analyst reports.18,19


Still, Apple and Google are continuing to launch their mobile-payment services in more countries, including Australia, the U.K., Canada, Japan, Taiwan, and Russia. And Google in September 2017 launched a new payment app in India that doesn't require NFC, instead allowing phones to communicate directly with each other using encoded ultrasonic frequencies via a technology known as audio QR. Mobile payments have soared in India since the government temporarily withdrew high-value banknotes from circulation in 2016.20



China's mobile-payment services are rapidly expanding into other countries, often through partnerships with local companies, while U.S. mobile payment services also continue to grow internationally. The initiatives may provide international businesses with additional opportunities for cross-border trade and new ways to make cross-border payments.

Mike Faden - The Author

The Author

Mike Faden

Mike Faden has covered business and technology issues for more than 30 years as a writer, consultant and analyst for media brands, market-research firms, startups and established corporations. Mike also is a principal at Content Marketing Partners.


1. “Race for China’s $5.5tn mobile payment market hots up,” Financial Times;
2. “Alibaba Affiliate Ant Financial: World's Largest Fintech Poised For More Growth,” Seeking Alpha;
3. Alipay takes on Apple and PayPal with US expansion,” The Verge;
4. “Tencent extends WeChat Pay to the US with focus on Chinese tourists,” South China Morning Post;
5. “Race for China’s $5.5tn mobile payment market hots up,” Financial Times;
6. “Analysys: China’s Third-party Mobile Payment Size Hit RMB9,041.9 Billion in 2016 Q3,” Analysys;
7. “Number of mobile cell phone subscriptions in China from June 2016 to June 2017 (in millions),” Statista;
8. “Asia Pacific leads the world in mobile payments in latest study by Kantar TNS,” Kantar TNS;
9. “Tencent extends WeChat Pay to the US with focus on Chinese tourists,” South China Morning Post;
10. “Tencent expands WeChat’s ecommerce platform in Europe,” Financial Times;
11. PayPal taps into China's 100M Baidu Wallet users, Cnet;
12. “Alipay takes on Apple and PayPal with US expansion,” The Verge;
13. “Customers in the East Go to BAT for NextGen Financial Services. Will the West Follow?,” TABB Group;
14. “Alipay,” Ant Financial;
15. “How Alipay Works,” Ant Financial;
16. “Alibaba’s Ant Financial partners with Hutchison to develop its Alipay service in Hong Kong,” TechCrunch;
17. “Apple Faces Tough Competition in China's $5.5 Trillion Mobile Payments Market,” Bloomberg News;
18. “The GMV of China's Third-Party Mobile Payment Shot up 113.4% in Q1 2017,” iResearch;
19. “Nearly one year after launch, Apple Pay finds limited traction in China,” TechCrunch;
20. “Google’s new payment app for India uses sound to transfer money,” The Verge;

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