iResearch report shows Alipay remains as China’s mobile payment market leader

iResearch, a leading provider of online audience measurement and consumer insights in China, published its 2020 Q1 Third-party Mobile Payment Market Data Report on June 29. Full report in Chinese can be found here: https://www.iresearch.com.cn/Detail/report?id=3601&isfree=0

 

Key highlights:

 

1. Alipay remains in the lead in China’s third-party mobile payment market, reporting a 55.4% market share, followed by Tenpay with 38.8% in the second place (Tenpay = Tencent’s WeChat Pay + QQ Wallet). According to historical reports of iResearch, Alipay has continued to increase its mobile payment market share for four consecutive quarters since Q1 2019. (note: iResearch historical reports can be accessed here (in Chinese only) Q1 2019, Q2 2019, Q3 2019, Q4 2019, Q1 2020) 

 

2. Against the backdrop of Covid-19 pandemic, the total size of third-party mobile payment transactions in China reduced for the first time in 2020Q1 to RMB53.2 trillion, a 4.0% drop as compared to the same period last year. iResearch expects transactions to rebound in Q2 along with domestic economic recovery.

 

3. iResearch points out that in China, future growth opportunity lies with the third-party payment providers’ capability to offer business clients integrated “Payment + Technology” solutions, instead of competing just on payment volume.

 

Earlier in March, Alipay announced a three-year plan to support the digital transformation of 40 million service providers in China, providing a comprehensive digital daily life services platform and a go-to-app for consumers to quickly find service providers to meet their daily life needs.

When asked about its view on the mobile payment market share over LinkedIn, Alipay said "Payment isn't the end game, but the beginning of a wide range of services that enrich daily life. We are dedicated to supporting the digital transformation of the services industry by leveraging our technologies, instead of just focusing on payment market share," reflecting that the company’s business model has gone beyond providing payment solutions, to providing a comprehensive digital suite of technologies,  including payment, to service providers.

 

Alipay Digital Daily Life Services Platform Facts and Figures

 

• Digital coupons: From July 1st on, Alipay will help service providers distribute digital coupons totaling RMB 10 billion yuan across the country. With just an Alipay payment collection QR code, micro businesses and street vendors can sign up easily to participate in the digital coupon initiative and attract mobile-savvy consumers. The smallest digital coupon is 20% off for a minimal spend of RMB 10 yuan. The initiative, which was announced on June 15, attracted more than 1 million merchants as of June 22.

 

• Alipay mini programs: As of now, there are over 2 million mini programs on Alipay’s digital daily life services platform with over 600 million monthly active users. The number of Alipay mini programs built by providers in education, training, hotel, tourism and health care is growing the fastest. Digital daily life services providers include financial service providers, such as banks, asset managers and insurance companies.

 

 

• As of June, 2020, administers of 1,000 tourist attractions have leveraged Alipay’s full suite of digital solutions to set up digital branches on Alipay, which caters to the “before”, “during” and “after” trip needs of consumers, including contactless tickets and hotel booking, digital coupon distribution, audio guidance, mobile payment, and other tourism related services. Alipay mini program helps tourist attraction administrators improve operation efficiency and provides a safe and convenience travel experience to users.

 

• Over 25,000 hotels launched virtual storefronts on Alipay to provide one-stop services for their users, including booking, checking-in, invoice application, transportation and dining. Over 25,000 hotels distributed loyalty cards on Alipay platform. In the two weeks ending June 10, the membership number of 26 big hotels chain increased by 361%, with member spending accounting for more than half of the total revenue. For example, BTG Homeinns Hotels Group, one of China's largest and fastest growing economy hotel chains, has accumulated one million new members via Alipay since 2019.

 

• 4 major recruitment firms, namely zhaopin.com, liepin.com, doumi.com and qtshe.com, have launched Alipay mini programs, featuring job vacancies from over 1,000 companies in over 600 industries. As of May 15, the number of average daily users searching for jobs on Alipay increased by 10 times in May compared with April.

 

• Administrators in over 300 cities and 400 counties in China have launched mini programs on Alipay to provide digital public services to citizens, such as collecting one’s social security funds, housing funds and issuing certificates, with just a few taps on their phone and no need to travel at all.

 

• Alipay has partnered with over 700 financial institutions in China and beyond, leveraging its technology to improve the efficiency of inclusive financial services for partners.

 

• • In China, Alipay supports over 200 banks in areas of payment business, financial technology, open-banking, mini-programs and so on. In addition, Alipay also supports asset management companies, insurance companies and rural credit unions. 
  • Outside of China, Alipay works with about 250 financial institutions including banks, bank card associations and e-wallet providers to provide inclusive financial services, including cross-border remittance and payment.

 

• Like with all providers in the service sector, the Covid-19 pandemic accelerated the digital transformation of financial service providers, including banks. In the two months through April, 2020, the number of financial institutions using Ant Group’s mobile banking and computing products and services have gone up by 175%. Through the same period, the number of inquiries from financial institutions on Ant Group’s technology products and services increased by 400%.      According to a Forrester research report, it’s estimated that Ant Group’s SOFAStack technology has saved PICC Health and MYbank over RMB 100 million (UDS 14 million) in three years. Ant Group filed the most blockchain patents globally for four consecutive years since 2016, and has deployed its proprietary blockchain technologies in over 50 use cases, with a performance capability to support 1 billion user accounts conducting 1 billion daily transactions. Ant Duo Chain, a supply chain finance solution leveraging Ant Group’s blockchain technology, has supported more than 30,000 companies secure funding with ease. In June 2020, Alipay announced it has set up a standalone company to take OceanBase, a self-developed distributed database solution that has been tested by 11.11 global shopping festival and used for years to support key clients in various industries, to the next level.