In China, mobile payment solutions successfully conquered the market, with Alipay and WeChat Pay as the main players. And now, the two giants are set to lead the world into a cashless society.
Alipay and WeChat Pay both influenced the modern purchasing behaviors of the Chinese consumers. Their payment services aren’t limited to online transactions. They have expanded to brick and mortar, even to street vendors.
Due to the conveniences they offer, most of China bid good-bye to their wallets and credit cards. They embraced the cashless lifestyle. In fact, China’s mobile payment transaction increased to RMB 58.8 trillion last year and is predicted to grow at 68% growth rate in the next two years.
Alipay vs. WeChat Pay: Key Features and Differences
Alibaba’s Alipay is widely used in China and in other parts of the world such as Tokyo, Seoul, Korea and Singapore.
E-commerce is the core of Alipay. You can pay for movie and bus tickets, bills, and food deliveries. It also has an offline transaction wherein you can pay to stores and supermarkets.
When you are craving for food and bonding, you can use Koubei – a restaurant review and local services platform under Alipay. It lets you search for restaurants and read reviews. If you wish to split the payment with your friends, you can “go Dutch” and pay your share via smartphone.
Ali Travel also offers travel packages that will let you explore options with ease.
In addition, Zhima or Sesame credit is the Alipay’s credit agency that can check your credit score. If you have a high score, you can make a room reservation in a hotel without a deposit.
Alipay also has Ant Fortune, a wealth management platform from Ant Financial.
Alibaba launched this in 2015 to feature and sell financial products such as insurance and fixed-deposit products.
In this smartphone application, you can buy, watch and check your shares in the stock market.
Based on Ant Fortune, most of its users come from post 80’s and 90’s generation. Since its launching, it has gained 35 million users.
In the past two years, WeChat Pay has become Alipay’s biggest rival. Launched in 2013, WeChat Pay is the mobile wallet within WeChat, the leading social media platform in China.
Social interactions are the pillar of WeChat Pay. Let’s take WeChat Red Packets as an example.
In China, there’s a tradition of handing out red envelopes with small cash gift inside it during New Year’s Eve. WeChat saw the opportunity and created Red Packets, which lets users send digital cash within the WeChat app. It transformed payments into a form of communication.
Eventually, Red Packets became WeChat’s secret weapon. It boosted the user base of WeChat Pay and convinced people to sign up for a mobile wallet.
Apart from that, Tencent tied up with Dianping, Yupiaor, Didi Chuxing and Meilishuo and JD.com to make a world-class payment method. Because of these partnerships, you can rent a car, get online products, order food online and buy movie tickets with your WeChat Pay account.
The Future of Payments
The mobile payment solutions in China is indeed suitable in their fast-paced economy. Alipay and WeChat Pay’s rivalry competition continue as they aim to expand globally.
According to National Travel and Tourism Office, there were 2.6 million Chinese visitors in 2015 and it is predicted to increase by 6 million in 2021.
For this reason, Alipay made a deal with the U.S. on May 8 that more than 4 million US merchants will accept its payment services. Ant Financial clarified that their target is Chinese consumers and not the Americans.
Alipay’s competitor WeChat Pay plans to extend their services to the Chinese consumers in the U.S.
The space that the mobile payment earned in the business industry is something beneficial for merchants and retailers.
The ease and convenience that it creates in the customer’s experience will increase their engagement in the product. This means that the payment method will become one of the biggest considerations in marketing strategies and business plans.
Other companies will take advantage of the cashless trend by resorting to other options like payments through fingerprints, voice and facial recognition.
With this digital payment transaction, it will be easier for the entrepreneurs and retailers to speed up the growth of their companies.
Mobile payments paved the way to limitless business opportunities and global relationships. To prove, there are now 15 countries that are cashless around the world.
The top five countries are Singapore, Netherlands, France, Sweden, Canada and Belgium.
Are These Mobile Payments Here To Stay?
The progressive technology empowers the existence of mobile payment systems. Companies took advantage of this online generation to amplify their influence.
As technology advances so are the people’s way of living. With this in mind, the mobile payment will be around for long.
This cashless movement became one of the world’s standards in economic progress. Thus, more and more countries are beginning to explore and adopt its system.
The competition between Alipay and WeChat Pay will surely stay strong. In this digital era, atm cards will be replaced by smartphones for cashless payments.
Who knows, in a few years, money might just be out of the picture.
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