Alibaba Financial Affiliate Seals Bank Deals for Alipay Expansion in Europe
Alibaba Group Holding Ltd.’s financial affiliate said it would collaborate with three banks and a payments company in Europe as the Chinese company seeks to expand its presence there.
Ant Financial Services Group, which operates the Alipay online-payments platform, will work with France’s BNP Paribas SA, London-based Barclays PLC, Italy’s UniCredit SpA and Swiss firm SIX Payment Services to increase the number of European merchants that accept Alipay, the Chinese company said Tuesday.
The Hangzhou-based internet finance company wants to expand globally, laying the groundwork for a payments platform that could challenge Visa Inc. and Mastercard Inc.
With more than 450 million users, Alipay dominates China, the world’s biggest e-commerce market, handling nearly half of the estimated $738 billion Chinese consumers spent online last year, according to market research firm iResearch. Alipay accounts are linked to bank accounts, and users can hail taxis, book a hotel, buy movie tickets and even invest in mutual funds using the service. Ant Financial’s payments platform processed 153 million online transactions a day, on average, in the first quarter—almost 10 times more than PayPal Holdings Inc., nearly as many as Mastercard and around 60% of the volume of industry leader Visa, according to an Alibaba investor presentation in June.
The partnership puts Alipay a step closer to achieving its goal of being accepted by one million merchants in three years. As of the end of September, consumers were able to use Alipay at almost 100,000 overseas merchants in 70 countries, Ant Financial said. In Europe, Alipay users pay via bar codes scanned by merchants, similar to how in-store payments are made domestically.
Ant Financial is hoping to tap the growth in Chinese outbound travel as it expands overseas. Tourists from China spent $215 billion abroad in 2015, an increase of 53% from 2014, according to the World Travel & Tourism Council.
Tuesday’s tie-up adds to existing partnerships with French and German payments companies Ingenico Group SA and Concardis GmbH, and Frankfurt airport retailer Tripidi in Europe. Ant Financial is also expanding further into Asia and in the U.S. Last month, the company unveiled an investment in the online payments arm of Thai conglomerate Charoen Pokphand Group. The Chinese company is also working with U.S. payment companies First Data Corp. and VeriFone Systems Inc.
Source: WSJ
