Walmart ditches Alipay in favor of WeChat in western China

Walmart has stopped supporting Alipay and started accepting WeChat pay at all stores located in the Huaxi region of China (western China, including Yunnan, Guizhou, Sichuan, and Chongqing), local media is reporting.

About a week ago, an image of a public notice at a Walmart store in Chongqing started circulating online. It stated that Walmart will stop accepting Alibaba’s payment method from March 15. On the same notice was the company’s announcement of a new WeChat Pay two-week promotional campaign.

Walmart Huaxi has confirmed the rumor that it has, in fact, reached a deep partnership with WeChat and there will be more exclusive benefits and discounts coming up soon. The two will also collaborate in big data analytics and precision marketing, the company said. The multinational retailer said it has ended the partnership with Alipay the two formed in 2015 and that it was a solely business decision.

There is a Walmart-Tencent relationship that is perhaps less obvious to an outsider’s eye, however.

Walmart is JD.com’s third-largest shareholder with just over 12% of shares, and the two formed a strategic partnership back in 2016. WeChat Pay’s operator Tencent is JD.com’s largest shareholder with over 21% share. So, ever since the partnership with JD.com, Walmart has become a part of Tencent’s blueprint to enter new retail.

The Alibaba-Tencent turf war isn’t new and neither is Tencent’s exclusive right to its competitive strategy. Last September, when Starbucks announced that it would start accepting Alipay, 10 months after it had reached a deal with WeChat Pay, local media speculated that this was part of the exclusive rights deal with Tencent.

On Wednesday (March 21) Tencent’s CEO Pony Ma Huateng, responded to a question regarding the Tencent-Alibaba rivalry saying: “I think reasonable competition is good for stimulating the development of the industry. This is why mobile payment has grown at such a rapid pace in China — because there’s reasonable competition in the market. So, it’s not a bad thing to have competition, everyone needs to look at this in a more positive way.”