Major bank launches Alipay

Commonwealth Bank’s (CBA) business customers that use the Albert point-of-sale terminal will be able to accept payments via Alipay, a digital wallet operated by Chinese e-commerce giant Alibaba’s financial services arm Ant Financial.

Merchants will be required to download the ePay app on their Albert device – of which there are 94,000 being used across Australia – to accept Alipay payments and to send location-based promotions to wallet users.

Alipay has 900 million users globally, largely from its native market of China, which dethroned the US in 2016 as the world's largest market in mobile payments with a transaction volume of US$235 billion that year. That figure increased to US$12.8 trillion from January to October 2017.

At the same time, Chinese visitors are Australia’s largest tourist market. In the year to June 30, 2018, more than 1.4 million Chinese tourists visited Australia (out of 8.4 million visitors), up 13 per cent from the previous financial year, and spent about $11 billion (out of $42.5 billion), according to Tourism Australia. Chinese visitors’ spending potential is estimated to be worth up to $13 billion by 2020.

Further, by the end of December 2017, there were more than 166,000 Chinese students in Australia, representing more than 43 per cent of the total international student cohort.

CBA executive general manager of business customer solutions Clive Van Horen called the launch a “game changer”, while ePay country manager for Australia Matthew Blayney claimed that it would “[drive] increased footfall to stores, higher overall sales and better marketing opportunities over the coming months in particular.”

Alipay country manager for Australia and New Zealand George Lawson said Australian businesses have been demanding improved exposure to the Chinese visitor market through access to Alipay.

“With the festive season fast approaching, businesses that use Alipay will be best placed to attract additional sales in what is a busy travel period for Chinese consumers,” he said.

“We are thrilled to partner with CBA to help drive Alipay acceptance in the Australian market so that Chinese customers can use a payment method that’s familiar to them.”

Ant Financial has been aggressively expanding Alipay's footprint beyond China, partnering with banks and other organisations around the world such as Uber to tap Chinese consumers during overseas travels.

“Banks are pivotal to Alipay’s expansion in Australia, and the fact that CBA has a growing market share in business banking customers means we can now switch on our technology for thousands of merchants simultaneously through their existing Albert devices,” Mr Lawson said.

This is not the first time Commonwealth bank and Alipay have joined forces. In 2016, the two parties entered into an agreement for Alipay to be able to use the major bank’s digital payments infrastructure to enable Australian consumers to make purchases across Alibaba Group’s e-commerce websites including AliExpress. 

The companies also at the time began experimenting with Alipay payments via Commonwealth Bank’s Albert terminal.  

National Australia Bank recently inked a deal with Alipay to allow its merchant customers to accept payments from Chinese visitors. 

[Related: Bank gets on board with more digital wallets]