Alipay expands to Australia, gunning for Apple Pay and Android Pay

Chinese mobile payments giant Alipay is attempting to spread its influence in a big way by partnering with an Australian payments provider to launch Alipay in the country’s stores.

For this initial excursion into Australia, Alipay is collaborating with Quest Payment Systems, an Australian payments provider that has already begun to instate the Alipay technology at select stores in the country. Alipay is hoping that the diaspora of Chinese nationals—who have adopted the Alipay technology in astounding numbers—will help facilitate the spread of its technology far outside the bounds of the near-monopoly it maintains in China.

“‘We are delighted to provide the first large scale rollout of Alipay into an Australian network,” said Luke Feller, innovation manager at Quest. “Alipay customers can now simply scan a code displayed on the screen of our QT720 payment terminal in order to pay from their mobile phone.

“It’s simple, intuitive and ensures that the customer can see exactly what their purchase will cost in both AUD and their local currency.’

Across borders
According to a press release, recent growth for mobile payments in China has been substantial, with Business Insider projecting that China will process $6.3 trillion in total mobile payments by 2020, and Tourism Australia reporting that Chinese visitors spent a record $8.9 Billion over the past year to March 2016. On average, Chinese tourists spend approximately $8,000 during each visit to Australia, providing significant opportunity for Australian retailers.

As such, Australia is a natural step for Alipay: it is close, Chinese transactions within the country seem to be lucrative and the partnership with a domestic presence like Quest will provide an organic in for the Chinese company’s establishment process within the foreign market. Also, it does not hurt that the country is China’s sixth-largest trading partner.

For the consumer, Alipay will make it simpler for Chinese nationals, tourists and students to pay for purchases in-store using their mobile phones, and in RMB. Quest designed its software to fully integrate with existing POS systems, providing a seamless experience for retailers and customers.

Quest’s software quickly enables its terminals to convert the currency and process Alipay transactions, a benefit that some pilot retailers, such as The Chemist Warehouse and My Chemist pharmacy groups, have already reaped.

Global expansion
News of the collaboration follows soon after Alipay’s deal with a number of banks to expand to Europe, also targeted towards Chinese tourists traveling to the continent.

For now, Alipay’s expansion maneuvers look to try and spread the mobile payments technology’s sphere of influence by primarily courting Chinese nationals traveling abroad—there does not seem to be any angling towards direct competition with Apple Pay in the US and Google’s Android Pay in Europe.

However, with an IPO on the horizon (Alipay is the world’s second richest private technology company, behind Uber) prospective shareholder ambition may cause Alipay to give a second thought to developing infrastructure to court the foreign consumer.

The boom in the Chinese economy has produced a class of consumer that has readily adopted sets of norms produced by Chinese industry, including massive companies such as Alipay and its ilk. As a part of its Global Shopping Festival, Alibaba celebrated a massive boon of over $7 billion gross merchandise volume, all settled through Alipay (see story).

And not to be outdone in the realm of international mobile payments, Western Union recently announced the expansion of its money transfer application to customers in Canada (see story).

“We had great experiences working together with Quest and Chemist Warehouse, and are looking forward to the up-coming 12.12 in-store shopping festival,” said Kiki Wu, country manager of Australia and New Zealand at Alipay