Mo­bile wal­lets be­com­ing way of life: Study Ali­pay gain­ing ground in 2016

China Daily (Canada) - - VIEWS - By HE WEI in Shang­hai hewei@chi­nadaily.com.cn

Mo­bile wal­lets have grown into a life­style choice em­bed­ded into daily ac­tiv­i­ties and in­ter­ac­tions, as more Chi­nese em­brace third-party ser­vices to pay back credit cards and run er­rands, a lat­est study has found.

Ali­pay users from five mu­nic­i­pal­i­ties and prov­inces made av­er­age trans­ac­tions of more than 100,000 yuan ($14,400) via Ali­pay last year, the coun­try’s top on­line pay­ment provider said on Wed­nes­day.

Users in Shang­hai topped the rank­ing with av­er­age spend­ing of 148,000 yuan in 2016, 1.5 times that of 2015.

In terms of to­tal trans­ac­tion vol­ume, Guang­dong prov­ince grabbed the top spot by claim­ing 16 per­cent of the pay­ment pie na­tion­wide.

The study also found that mo­bile gad­gets have become the main­stream ve­hi­cle for pay­ment. In 2016, about 71 per­cent of all trans­ac­tions con­ducted via Ali­pay went through mo­bile de­vices, up from 65 per­cent from the pre­vi­ous year.

Dig­i­tal wal­lets have gained tremen­dous pop­u­lar­ity in in­land prov­inces, the firm said, where res­i­dents rely ex­clu­sively on their smart­phones and mo­bile car­rier cov­er­age to ac­cess the in­ter­net.

For ex­am­ple, 90 per­cent of Ali­pay trans­ac­tions were con­ducted on mo­bile de­vices in the Ti­bet au­tonomous re­gion and 88 per­cent in­Qing­hai and Gansu prov­inces.

Ac­cord­ing to World­pay’s 2016 Global Pay­ments Re­port, Ali­pay ac­counts for 44 per­cent of global mo­bile wal­let spend­ing and is on pace to reach 60 per­cent by 2020.

It also gained steam by in­te­grat­ing its pay­ment func­tions into pub­lic ser­vice plat­forms. With a few taps on the app, its 450 mil­lion users can pay util­ity bills, set­tle traf­fic ticket fine pay­ments and make med­i­cal ap­point­ments.

On­line ac­cess to these ser­vices is made avail­able in 357 cities in China. Such ser­vices were ac­cessed over 1 bil­lion times last year, up 218 per­cent from the end of 2015.

Chi­nese peo­ple are in­creas­ingly will­ing to make pur­chases with bor­rowed money. Pow­ered by a credit-scor­ing ser­vice from Ali­pay’s par­ent Ant Fi­nan­cial Ser­vices Group, some 2.3 bil­lion trans­ac­tions on Ali­pay were made with loan ser­vice Ant Check Later, up 344 per­cent year-on-year. Around 40 per­cent of Ant Check Later users were born in the 1990s.

Chi­nese pay­ment tools have become an es­sen­tial part of con­sumers’ day-to-day life­style, years ahead of theirWestern coun­ter­parts, said se­nior IT an­a­lyst Yang Yaqiong from con­sul­tancy Analysys.

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