BEIJING: Alipay, the financial arm of internet giant Alibaba, plans to tap into overseas spending by the growing number of Chinese tourists by partnering with one million foreign offline merchants during the next three years.
That marks an ambitious advance on its initial foray into cross-border payment last year when a mere 70,000 overseas merchants accepted payment via the Alipay app, the South China Morning Post reported.
"Our users at home in China are comfortable with using Alipay in their everyday lives," said Sabrina Peng, vice president of Alipay International. "We want to extend the convenience to our users when they travel abroad."
The numbers involved are significant. The World Travel & Tourism Council Organization has estimated that Chinese nationals travelling overseas spent some $215bn in 2015, a 53% increase on 2014.
And that number is set to grow as hundreds of millions of Chinese move into the middle class demographic and contemplate overseas holidays. Alipay reported being used by 120m users overseas last year and expected that its tie-up with more merchants would help push that figure over 200m.
"The vision is targeting two billion people within next five to ten years, not only in China but other countries too," Peng told a European conference earlier this year.
In recent months Alipay has announced an expansion into Europe, partnering with local payments processors including Wirecard and Worldline.
Business Insider noted that this was unlikely to be an important acquisition channel for Alipay but would benefit it in simple revenue terms as tourists chose a familiar payment option.
More important in the long term, however, it may encourage greater loyalty by discouraging users from experimenting with alternative payment methods – foreign businesses such as Visa, MasterCard and Apple Pay are looking to establish themselves in China – that they might keep using when they return home.
Data sourced from South China Morning Post, CNBC, Business Insider; additional content by Warc staff