This past Golden Week—an eight-day national holiday in China—Alibaba’s mobile payment solution Alipay recorded eight times as many in-store transactions overseas as the same period last year.
This comes as no surprise: Alipay, along with its arch-rival WeChat of Tencent, has embarked on an aggressive global expansion in recent years. For now, most of their overseas usage is driven by the veracious outbound Chinese tourists who are now the world’s top spenders. 135 million Chinese outbound tourists spent a total of $261 billion in 2016, according to World Tourism Organization. As Alipay and WeChat become more common in foreign lands, Chinese tourists can skip the hassle of exchanging foreign currencies and carrying cash around. Research shows only a little over 10% of Chinese outbound tourists prefer to pay with cash or credit cards.
Alipay is now available in more than 30 countries and regions across Europe, North America, and Asia. Its transaction volume in Hong Kong topped the list during this Golden Week, followed by Thailand, Taiwan, Japan, and South Korea. WeChat is currently available in 13 countries and regions.
To lure consumers, both payment giants are offering generous perks. During the holiday, Alipay users consumed a total of 1.2 million e-coupons, 200,000 of which were redeemed in Hong Kong alone.
Not all foreign vendors are ready for the Chinese payment methods, however. Yuneng, a 27-year-old newly-wed, told TechNode that he failed to pay with WeChat during his honeymoon in Japan.
“We would have loved to pay with WeChat, but the cashier at the pharmacy didn’t know how to use it.”
When it comes to cracking the local market, Alibaba seems to be ahead of the game. Unlike WeChat, Alipay is a standalone financial instrument. Across the globe markets for social apps have well been divided by early movers like Facebook, WhatsApp, Line, and Kakao. Last month, Ant Financial, the operator behind Alipay, announced a joint venture with Hong Kong mogul CK Hutchison to boost its service first introduced to the city last year. Hong Kong, where WhatsApp and Line are popular, might not want to switch to a new social app, but they might give a chance to a financial tool that will help them pay with their mobile and manage their money more efficiently at the same time.