ByeBye Alipay, 360buy Got Married With UnionPay

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We reported back in May that 360buy had removed Alipay, the no.1 online payment solution from its payment methods. No one really knows what’s going on there since then. But yesterday, in Chengdu, at the same place APEC SME Summit 2011 (I was there attending) was held, 360buy together with UnionPay, the national bankcard association in China, announced their strategic partnership on online payment as well as mobile payment solution. We broke the news on weibo and the tweet has been retweeted ~650 times and commented ~140 within several hours. It’s probably for the first time, a leading Chinese eCommerce site said NO to Alipay.

Apparently, Liu Qiangdong, CEO of 360buy is not happy with the high commission fee charged by Alipay. He used to complain that the commission fee charged by Alipay is almost 4 times than the other payment gateway provider, and thus 360buy has to pay rmb 5-6 million more. According to 360buy’s official, around 80% of its users are using Pay On Delivery as payment method and only 1-2% transactions are paid via Alipay, so taking Alipay off should not be a big problem for 360buy users.

However, the story behind it might be more complex than we thought.  A VP of Dianping (the leading Chinese Yelp) commented on the weibo saying, the true reason caused the split is that 360buy is not happy with Alipay’s keeping the record of all 360buy’s customer data, according to his insider friends.

Also today, on 360buy’s payment methods page, UnionPay has taken place of Alipay and becomes the top recommended payment method. Furthermore, 360buy will also widely adopt UnionPay’s MicroSD Card mobile payment solution for its mobile eCommerce strategy.

Apparently, Alipay is facing a serious threat from UnionPay, not only on web-based online payment, but also in mobile space. 360buy is the first one said No, and I guess it would not be the last one.