What US and European financial services can learn from Alipay

By Alara Basul | 1 November 2017

Alipay, China’s leading third-party payment platform, aims to simplify the way consumers pay. Operated by Ant Financial Services Group, the fintech has already amassed incredible popularity; the platform boasts over 520 million active users in China, is accepted in more than 30 countries worldwide and has over 200 domestic financial institution partners. 

We sat down with Souheil Badran, President of North America at Alipay at Money20/20 Las Vegas to talk payment trends, addressing financial inclusion and how Alipay has evolved from a digital wallet to a lifestyle enabler.

Tell us about your role at Alipay.

My role is president of Alipay North America. I’m responsible for the growth of the business in this region, and our focus is really on simplifying the way that Chinese consumers and tourists pay when they’re travelling to the US and Canada.

We want to enable consumers to be able to pay with the method that they’re familiar with, which is Alipay.

Alipay announced several partnerships at Money 20/20, from Verifone to Poynt. Tell us more about these.

It’s been an exciting time for us. We announced partnerships with NAB, Marqeta, Verifone and Poynt.

With Chinese consumers traveling more than ever, there’s a big opportunity to help these consumers   who seek a familiar, frictionless payment wherever they go. In Las Vegas and New York there will be more than 16,000 taxis accepting Alipay. For a Chinese consumer travelling here, it’s much easier for them to use Alipay than worrying about paying with a card or a method they’re unfamiliar with.

Our announcement with Poynt, the maker of the world’s first smart terminal, is to enable Alipay’s 520 million registered users in China to pay with Alipay across all Poynt devices in North America.

Through the agreement, Alipay users visiting North America will enjoy a seamless, familiar checkout experience using the payment method that is most comfortable for them. Poynt has a great point of sale platform with an intelligent terminal, and with that integration, it gives us access to all of Poynt’s merchants in the US.

It’s been a busy week, but all these partnerships are aligned to our strategy of simplifying the payment process for the Chinese tourists coming to North America, and in addition, how we can enable Chinese-Americans and Chinese-Canadians who are living here already and have Alipay to also leverage and use the app.

Your panel talk at Money20/20 highlighted trends of the Chinese consumers; how do these compare with the rest of the world? What trends are you seeing developing from East to West?

There are a lot of similarities. If you look at it from the perspective of the Chinese tourist, they travel for certain reasons such as finding new experiences and luxury shopping – this is going to be true regardless of where they go. According to the World Tourism Organization, the Chinese tourism market is estimated at more than $164bn and Chinese consumers are the largest spenders worldwide. The number of Chinese consumers visiting North America is predicted to grow to four million this year, with the Chinese middle class being the fastest-growing online consumer market in the world, expected to reach 600 million by 2022.

We look at catering to the Chinese tourist pre-trip, mid-trip and post-trip. Through our various apps, we try and look at where these consumers are going and work with our merchants so that they can cater to that tourist based on their location.

The trends themselves don’t change that much by country, the experiences are really focused on where the top areas are that they’re visiting. We focus on the commercial locations such as airports and shopping centres, where we know there will be traction. So we work with these merchants to ensure we’re offering the right incentives for the Chinese consumer to come and use Alipay.

The Chinese consumer is miles ahead in terms of digital payments – will other markets follow suit?

The need is usually based on different use cases. In the US, credit cards have been around for over 50 years, and people have become extremely comfortable with just swiping a credit card.

China’s culture is different – it’s really about financial inclusion, which is really our mission with Ant Financial. You can’t just go in with a form of payment, it’s really about looking at other services that we can incorporate with the Alipay platform, and that’s why we think of it as a digital lifestyle app. You can do anything from payments, book transportation, arrange hotels and pay utilities.

There’s always an opportunity to bring the market together; the US is quite a mature market, so adoption for newer products may be slower.

Mobile payments and digital banking have been featured heavily at Money20/20 this year. What will we be talking about this time next year?

Being part of the mobile industry, we definitely want to see more digital payments.

If we’re a catalyst in helping the market grow, especially when it comes to mobile payments, then we’re very excited about the future. Payments should be frictionless with a great end-to-end experience. We’re really focused on partnerships to expand our reach in the US.