Apple is reportedly going to include a Chinese mobile wallet in Apple Pay in its upcoming iOS 14 update with addition of Alipay to its roster of accepted payment methods.
Why it matters: Chinese payment apps like Alipay and WeChat Pay are looking to expand overseas.
- Raymond Wang, partner at Roland Berger told TechNode that the deal will drive traffic and users to Alipay, while Apple retains influence over its ecosystem.
- Apple Pay is on track to account for a tenth of all global card transactions, and generated $12.7 billion in revenue in the fourth quarter.
- To push people to setup their Alipay within their Apple Pay wallets, “Alipay still needs to have lots of marketing, promotions, and business development with shops,” Wang said.
Details: Apple news blog 9to5mac reports that leaks of iOS 14 code point to Apple Pay supporting the Chinese mobile payment platform.
- The developer community expects Apple to announce the launch of iOS 14 in June at the WWDC 2020, which will be delivered online.
- The integration of Alipay “does not mean that Apple will not cooperate further with other mobile pay players,” said Wang, who added it was likely that WeChat Pay would be vying for inclusion.
- An Alipay representative declined to comment.
Context: Digital wallets are not only vying to replace physical counterparts, but add non-payment functions to retain users and increase the number of services users open their apps for, too.
- Last week, Ant Financial announced plans to support millions of third parties in providing digital lifestyle services in its Alipay app.
- Ant Financial has bought stakes in other payment apps, with the Swedish payment app Klarna, its most recent move.
- As of June 2019, Alipay had 1.2 billion users globally, and aims to serve 2 billion users over the next ten years.
- Its domestic competitor Wechat Pay, is embedded into WeChat which has 1.1 billion users.
- The Chinese mobile payment platform has been looking to raise its international profile by partnering with digital wallet companies.