Users in the US, the UK and other parts of Europe can now avail themselves of the digital payment service
After finding great success in its home market of China, digital payment platform Alipay—operated by Alibaba affiliate Ant Financial—has its sights set on expanding overseas.
According to data from Analysys International Enfodesk, Alipay holds a comfortable position in its home market. In Q4 2016, Alipay accounted for 54.1% of mobile payment transactions in China, while Tencent’s payments service Tenpay made up 37.0%.
But the service has set its sights on overseas expansion, even though it will encounter some significant hurdles in those efforts. Alipay faces local incumbents, different consumer habits and regulatory obstacles from protectionist policies in some countries, especially in tightly regulated industries like financial services.
To increase its chances of success in foreign markets, Alipay is targeting China’s international tourists by forging partnerships with foreign service providers and businesses.
According to a study by China-based online travel agency Ctrip and the Center for China and Globalization (CCG), over 122 million tourists from China ventured overseas in 2016, generating $261 billion of tourism-related spending. Alipay hopes to tap into that spending as the digital payment service of choice among these traveling consumers.
Earlier in August, Alipay partnered with recommendation service Yelp to provide Alipay users with user-generated content on US cities within the payment app. The move will make it easier for tourists from China to identify and patronize vendors in the US that support Alipay, giving merchants there another reason to sign up with the payment service.
Alipay is also brokering agreements with foreign payments processors like Stripe, a PayPal-like service that now accepts Alipay in all of the markets in which it operates.
Alipay has also inked similar deals with local payment service providers in several other markets, including Singapore, the UK, and the broader EU region, thereby extending its international footprint.
Japan is another market that Alipay has set its sights on. Ant Financial predicts the number of stores in the country accepting Alipay will double to 45,000 this year. But the company also plans to rebrand its service in Japan, a sign it is looking to capture local consumers, and not just tourists from China.