October 20, 2014
Alipay Wallet, the mobile payments app, recently announced that it has reached this large user base. The figure of 190 million has been quoted by the company as the number of users who have had at least one payment or money transfer in a year using Alipay Wallet. Moreover, the number of daily transactions has reached 45 million. Alipay Wallet is currently processing over 50% of Alipay’s transactions.
Alipay actively supports third party merchants as well as Alibaba’s own marketplaces. Alipay Wallet is operated by Alibaba’s finance arm. At the end of 2012, Alipay's mobile version was rebranded as Alipay Wallet. Alipay Wallet was initially introduced as an app not just for mobile payments but also for personal financial management. Since then, it has added numerous features such as e-loyalty programs, e-ticketing, price comparisons, credit card management, real-time stock info, etc.
With added features, Alipay Wallet showed a rapid progression after its inception. In 2013 itself, Alipay Wallet had reached 100 million users and was processing one-third of Alipay’s transactions. It is further expanding to offline services as well. It now supports payments for taxis & public transportation. It can also be actively used at physical stores, vending machines, hospitals, parking lots, etc.
Alipay Wallet uses different technologies when it comes to processing payments, QR codes being one of them. The Chinese government had recently banned QR code scans but Alipay came up with a solution. Earlier this year, Alipay collaborated with Huawei to bring fingerprint scanning as a biometric authentication feature for Alipay Wallet. The biometric authentication service was first available with Samsung Galaxy S5 and later with Huawei’s Ascend Mate7. Huawei uses a specific technology to prevent third-party apps from accessing user’s fingerprints.
Alipay Wallet is also a known competitor to Tencent’s WeChat in mobile commerce and mobile content. A constant rivalry has existed between Alipay and Tenpay for quite some time. By the end of September this year, Alipay not only gained a significant market share but also took away a significant share from Tenpay. Considering the online payment market in China, Alipay accounted for 48.3% share in Q1 2013 while Tenpay accounted for 20.1%. But at end of Q2 2014, Alipay’s share rose to almost 80% while Tenpay’s share fell to below 9%.
Alipay’s growth has directly fueled Alipay Wallet’s growth as well. Alipay Wallet also incorporates a feature similar to WeChat which is open to businesses. Ten banks and three Chinese telcos have already joined it. Earlier this year Alipay started a new initiative to expand Alipay Wallet’s reach to overseas markets as well. It is now available in Taiwan, Hong Kong and South Korea.