Alipay

From Wikipedia, the free encyclopedia

Alipay
Native name
支付宝
Zhīfùbǎo
IndustryFinancial services
Payment processor
FoundedFebruary 2004; 17 years ago (2004-02) in Hangzhou, Zhejiang, China
FounderJack Ma
HeadquartersPudong,
Shanghai
,
China
Area served
Worldwide
Key people
Jack Ma
ProductsElectronic payment processing
Banking
Mobile payment
ParentAnt Financial
Websitewww.alipay.com
Alipay
Traditional Chinese支付寶
Simplified Chinese支付宝

Alipay (simplified Chinese: 支付宝; traditional Chinese: 支付寶) is a third-party mobile and online payment platform, established in Hangzhou, China in February 2004 by Alibaba Group and its founder Jack Ma. In 2015, Alipay moved its headquarters to Pudong, Shanghai, although its parent company Ant Financial remains Hangzhou-based.[1]

Alipay overtook PayPal as the world's largest mobile payment platform in 2013.[2] As of 31 March 2018, the number of Alipay users reached 870 million. It is the world's number one mobile payment service organization and the second largest payment service organization in the world. According to the statistics of the fourth quarter of 2018, Alipay has a 55.32% share of the third-party payment market in mainland China, and it continues to grow.[3][4][5]

History[]

The service was first launched in 2003, by Taobao. [6][7][8] The PBOC, China's central bank, issued licensing regulations in June 2010 for third-party payment providers. It also issued separate guidelines for foreign-funded payment institutions.[citation needed] Because of this, Alipay, which accounted for half of China's non-bank online payment market[citation needed], was restructured as a domestic company controlled by Alibaba CEO Jack Ma in order to facilitate the regulatory approval for the license.[9] The 2010 transfer of Alipay's ownership was controversial, with media reports in 2011 that Yahoo! and Softbank (Alibaba Group's controlling shareholders) were not informed of the sale for nominal value. Chinese business publications Century Weekly criticised Ma, who stated that Alibaba Group's board of directors was aware of the transaction.[10] The incident was criticised in foreign and Chinese media as harming foreign trust in making Chinese investments.[11] The ownership dispute was resolved by Alibaba Group, Yahoo!, and Softbank in July 2011.[12]

In 2013 Alipay launched a financial product platform called Yu'ebao (余额宝).[13] As of June 2013 the company still had what it called "a minor paperwork problem" with the China Securities Regulatory Commission, but the company said that they planned to expand the product while these are sorted out.[14]

In 2015, Alipay's parent company was re-branded as Ant Financial Services Group.[15]

In 2017, Alipay unveiled their facial recognition payment service.[16]

In 2020, Alipay upgraded from a payment financial instrument to an open platform for digital life.[17]

Services[]

Food ordering with Alipay in Mainland China

Alipay claims it operates with more than 65 financial institutions including Visa and MasterCard[18] to provide payment services for Taobao and Tmall as well as more than 460,000 online and local Chinese businesses.

Alipay is used in smartphones with their Alipay Wallet app. QR code payment codes are used for local in-store payments.[19] The Alipay app also provides features such as credit card bill payments, bank account managements, P2P transfer, prepay mobile phone top-up, bus and train ticket purchases, food orders, vehicles for hire, insurance selections and a digital identification document storage.[20] Alipay also allows online check-out on most Chinese-based websites such as Taobao and Tmall.[21]

The Alipay app allows users to add their own services provided from different companies to create a more personalised experience.

Since late-2008, Alipay has promoted public service payment services and has covered more than 300 cities nationwide, supporting more than 1,200 partner organizations.[22] In addition to utility bills such as water and electricity, Alipay also extends their services to areas such as paying transportation fines, property fees, and cable television fees.[23] Common online payment services also include hydropower coal payment, tuition payment and traffic fine.

On 15 January 2009, Alipay launched a credit card repayment service, supporting 39 domestic bank-issued credit cards.[24] It is currently the most popular third-party repayment platform. The main advantages are free credit card bills checking, repayments with no administrative fee, as well as automatic repayment, repayment reminders and other value-added services.[25] In the first quarter of 2014, 76% of credit cards were also paid by Alipay Wallet.

From December 2013, several chain convenience store companies, including Meiyijia, Hongqi Chain, and Qishiduo C-STORE and 7-Eleven, have successively supported Alipay payment; in December, Beijing taxi drivers began to accept Alipay to pay the fare. Subsequently, Wanda Cinema, Joy City, Wangfujing and other large-scale retail companies as well as movie theaters, KTV, and catering companies have access to Alipay.

From March 26, 2019, the service fee will be charged for the payment of credit card through Alipay. Customers only pay the portion of the payment that exceeds 2,000 yuan at 0.1%.[26]

In November 2019, Alipay introduced Tourpass, a service component that allows non-Chinese users to use its mobile payment feature by pre-loading Chinese Yuan equivalent foreign currency into the app.[27]

In 2020, Alipay used a QR code system to help in containing the COVID-19 outbreak. The health code system tags users one of three colors according to their location, basic health information and travel history.[28]

International expansion[]

Internationally, more than 300 worldwide merchants use Alipay to sell directly to consumers in China.[citation needed] It currently supports transactions in 18 major foreign currencies.

Since the launch of Alipay in the Mainland China, Ant Financial introduced a series of expansion of the services to other countries.[29][30][31][32]

Asia[]

Bangladesh[]

In 2018, Alipay bought 20% shares in Bangladeshi mobile financial service provider bKash Limited.[33]

Hong Kong[]

Signage shown in Hong Kong, welcoming both Mainland China version of Alipay and AlipayHK

In 2017, Ant Financial expanded to Hong Kong. In a joint venture with CK Hutchison, as Alipay Payment Services (HK), it launched the "AlipayHK" brand.[34] A standalone app provides features such as mobile payments and P2P transfers. All transactions are made and settled in local Hong Kong dollars.[35] The service then became available in major chain stores including McDonald's, 7-Eleven and Circle K.[36] Wet markets and other merchants were also supported.[37] From 2020 and 2021, with AlipayHK passing two million users, the service became accepted on MTR, buses and ferries.[38]

Japan[]

Alipay entered Japan in 2015, with network up to 38,000. Ant Financial hopes that their network in Japan could help Chinese tourists that are heading to Japan.[39]

Philippines[]

Alipay was introduced to the Philippines in 2018 by Asia United Bank (AUB).[40] AUB also introduced WeChat Pay, and intends to use both payment systems to cater to Chinese tourists visiting the country.[41]

Ant Financial also has invested on Mynt, the operator of the mobile service GCash which caters to the Philippine market. It helped convert GCash into a cashless mobile payment service similar to Alipay.[42] It is also working on rebranding the mobile wallet into GCash by Alipay by the second half of 2021.

Singapore[]

In 2017, Ant Financial partnered with CC Financial, a start-up company in Singapore. Alipay plans to expand its 20,000 acceptance points in Singapore, and open up their platform to Singapore banking users.[43][44]

South Korea[]

Alipay was introduced in South Korea in 2015, and is now available at various merchants around the country. Users can even receive an instant tax refund at four major airports in the country. In 2019, taxis in Seoul and Starbucks will accept Alipay via Kakaopay.[45][46][47]

Vietnam[]

Alipay entered Vietnam in 2010, with its network up to 21,000.[citation needed][clarification needed] Ant Financial hopes that their network in Vietnam could assist Chinese tourists visiting the country. Currently in Vietnam, Davitrans, a proxy shipping service, is the only website in the country that accepts Alipay as one of its payment methods.

Oceania[]

Australia[]

In February 2019, Alipay and Tourism Australia announced a service to promote Australian destinations to Chinese tourists using the city of Sydney as a 12-month pilot project. The new Sydney City Card will introduce an interactive city map in the Alipay app to alert tourists to participating locations and retailers where Alipay payments are welcomed. A similar initiative will be trialed concurrently in Queenstown, New Zealand.[48]

North America[]

United States[]

Ant Financial has partnered with First Data in 2017.[49] It allows Alipay service to be used at point-of-sale with more than four million retail partners in United States.[50]

Canada[]

In 2017, Alipay partnered with SnapPay to allow Canadian retailers to accept Chinese currency from Chinese shoppers. There are currently 800 merchants in Canada that supports Alipay, including most Cadillac Fairview mall locations in partnership with OTT Pay,[51] such as the flagship Eaton Center of Toronto and CF Chinook Centre in Calgary.[52][53] Air Canada began allowing transactions in Alipay to book flights from Canada and the United States beginning in August 2018, after initially rolling out the feature for booking of flights originating from China.[54]

Europe[]

Iceland[]

Alipay has partnered with Splitti and ePassi in Iceland.[55][56]

Italy[]

Alipay partnered with UniCredit, SIA and Banca Sella Group to enable app payments in physical and online stores in Italy.[57][58]

Norway[]

Alipay has started cooperating with Vipps in Norway. 30 shops in Bergen are ready to receive Alipay-customers, and in January 2019 some shops in Oslo will be ready.[59]

United Kingdom[]

Alipay partnered with Barclaycard in United Kingdom, bringing Alipay to UK retailers.[60]

Comparison with other payment systems[]

Alipay is conceptually similar to Apple Pay, WeChat Pay and PayPal because it overlays traditional card payment methods. Although users receive immediate notification of the transaction, the main difference among Alipay and an instant payment system, like Venmo or Zelle is that the funds transfer between counterparties is not immediate.[61] The settlement time depends on the payment method chosen by the customer, while for instant payment systems, the funds are transferred within seconds or minutes.

Pushback by Chinese government[]

In September 2021, the Chinese government stated its intent to force the lending functions of the Alipay app to be split off into their own application and separate back-end businesses.[62][63]

See also[]

  • Alipay Health Code

References[]

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