Chinese payment apps expand tourism programs

Will this have any real impact?

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In late 2019, AliPay and WeChat Pay (the two dominant mobile payment apps in China) announced they were expanding access to their respective platforms to tourists.

In 2023, international travelers can now link even more overseas bank card types from networks such as Visa, Mastercard, Diners Club International, JCB and Discover to the apps.

Given the ubiquity of both apps in the country (a 96% market share), this can facilitate transactions for individuals who do not have access to a Chinese bank account and phone number (which were key conditions to use AliPay and WeChat Pay for years). It’s also important to note that China is not a credit card-driven society. The percentage of consumers who own at least one card is roughly 44% (versus 77% in the U.S.). In comparison, mobile payments are much more prevalent these days.

But we have to go deeper…

The first time AliPay and WeChat Pay opened to international consumers was in late 2018/early 2019 when the apps allowed Hong Kong residents to make “cross-border payments” in Mainland China.

Visitor arrivals in Mainland China by nationality (2013-2019). Source: Wikipedia.

Due to geographical and cultural reasons, Hong Kong visitor stats dwarf every other nations.

Now that COVID-19 cases are a lot lower on a global scale, China is ready to open international tourism again. Will this have any effect on the use of the two “super-apps”?

Let’s be honest: a critical pain point for the Ant Group and Tencent subsidiaries was the difficulty for Hong Kong residents to use the platforms while travelling to the Mainland. Pre-pandemic, overseas tourism was just a drop in the bucket for a country with such a massive population (about 1.4 billion people); and this may not change much in the coming years.

Furthermore, visitors from “The West” could be reticent to temporarily use Chinese apps for sensitive activities such as payments, especially given the current “trade war” discourse.

For these reasons, it’s possible adoption will be limited but both platforms could increase their brand awareness beyond their home market.