Alipay strikes deal with Verifone in quest to reach overseas Chinese

Alipay
REUTERS/Aly Song/File Photo

FRANKFURT (Reuters) – China’s Alipay has agreed with US-based Verifone to integrate its mobile app on Verifone payment terminals at merchants in Europe and North America, the latest such deal to reach Chinese consumers travelling abroad.

Alipay, which counts 450 million active users in China, is the top mobile payments player there. It is a unit of privately held Ant Financial, which is in turn an affiliate of publicly traded Chinese Internet giant Alibaba.com.

It has begun actively expanding outside Asia this year via partnerships with Western payment providers. Verifone terminals are used by most of the top 200 retailers in the United States, a spokesman said. Instead of seeking to go head to head with major payments players outside its home market, Alipay targets the fast growing Chinese tourism market, which numbered 117 million travellers in 2014, according to the United Nations World Tourism Organisation, and is forecast to double by 2020.

Through the Verifone deal announced on Monday, Alipay is targeting top-tier merchants across retail, luxury goods, health supplement and department stores.

Alipay and rival WeChat, a unit of Tencent,together make up 90% of the Chinese mobile payments market, with gross merchandise value estimated at more than $1 trillion last year, dwarfing other mobile payment systems around the world, according to iResearch China estimates. Sabrina Peng, the president of Alipay International, said in a recent interview that her company’s ambition is to become a global payments provider over the next decade, with 60% of its transaction volume coming from outside China. “We are targeting 2 billion users in the next 10 years,” she said.

French payment terminal supplier Ingenico announced in August an expanded deal with Alipay to allow merchants across Europe to use Ingenico’s payment gateway to accept payments from Alipay users visiting the region.

The Alipay service is also being integrated into terminals from Concardis, a payments provider for merchants in German-speaking Europe. Wirecard, also of Germany, is developing a payment system that uses two-dimensional QR barcodes popular in China to help merchants across Europe accept payments from Alipay users.

Alipay has a similar deal with mobile payments start-up Zapper in Britain to allow Chinese tourists to use QR codes in more than 1,000 restaurants there.

(Reporting by Eric Auchard; Editing by Ruth Pitchford)

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