vritti
Mobilution
and Southeast Asia to help Chinese tourists
pay with Alipay or Wechat Pay to merchants
when they are abroad. Today Wechat Pay
is accepted in 25 countries while Alipay is
accepted in more than 30 countries.
What made these two Chinese
behemoths grow so fast in
mobile payments?
The answer probably will have multiple reasons
than a single one. One cannot ignore the
technological prowess of the Chinese when
it comes to providing smooth and simple
payments along with integrating thousands
of merchants across the globe. It can also
be partly attributed to the huge tech-savvy
millennials who were keen to try out the
latest technologies without worrying about
risks associated with it. Thirdly,
the Chinese government
restricted entry for non-
Chinese firms’, and controlled
the space with a Chinese
version for every offering
available worldwide.
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Finally, it is the advantage third party mobile
payments apps have over banks by complying
with less stringent regulations and conducting
transactions without any central clearing
house. To avoid potential money laundering
and other illegal practices, People’s Bank of
China (PBoC) has mandated that all third
party payment providers must channel
payments through a central clearing house
by next June. On top of that, likes of Alipay
and Wechat Pay have to allocate on average
20% of their total reserve funds with PBoC.
These steps will ensure a level playing field for
both banks and non-banking entities that offer
mobile payment solutions. Similar regulations
happened in other countries as well.
Till now, both Alipay and Wechat Pay have
only focussed on Chinese consumers within
and outside China. But their wish to be
successful in grabbing sizable market share in
other countries can only be realised through
partnerships with local firms. They cannot
employ the same strategies they used in
China as the cultures, regulations and
ecosystems changes from country to country.
Probably China is some years ahead of the
world when it comes to mobile payments.
E
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S
1. http://www.emarketer.com/Chart/Average-Daily-Time-Spent-on-WeChat-According-WeChat-Users-China-2015-
2016-of-respondents/207293
2. https://www.ft.com/content/e3477778-2969-11e7-bc4b-5528796fe35c
3. https://www.techinasia.com/wechat-pay-vs-alipay
4. http://thefutureofthings.com/10164-death-cash-cards-mobile-payments-shaping-future-commerce/
5. https://asia.nikkei.com/magazine/20171214/Business/Company-in-focus-Alibaba-affiliate-Ant-Financial-builds-
an-empire-of-services
6. http://www.asiaone.com/business/new-chitose-airport-becomes-worlds-first-wechat-pay-flagship-airport
7. https://www.forbes.com/sites/jinshanhong/2017/08/18/how-chinas-central-bank-is-clamping-down-on-the-
mobile-payment-industry/#60206a3550be
About the author: Manoj is Product Manager for mobiquity Money at Mahindra Comviva. He
carries close to 6 years of industry experience performing product support, strategy and product
management roles. He graduated from IIM Lucknow and is passionate about knowing how
technology has been making human lives better day-by-day.
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