Stripe’s recent expansion in Chinese payments opens up a vast market to the payments processor, but more notably, it allows Chinese payment giants WeChat Pay and Alipay to keep dominating that market — and gain entry into markets outside China.
Stripe will now allow global support for both of the most popular digital payment methods in China, the company announced today (along with its launch in Hong Kong).
The launch will integrate both methods into Stripe’s Sources API, opening the door to Stripe businesses in more than 25 countries to Chinese consumers using those services — which is quite a wide door, considering Alipay and WeChat together cover over 90% of the Chinese market.
As good as that is for Stripe businesses (one can only imagine what the company’s competitors, such as PayPal, think of the partnership) having this capability is even better for Alipay and WeChat Pay, operated by Ant Financial and Tencent, respectively, as the services can now extend their reach outside of China to serve the global Chinese consumer.
Souheil Badran, president of Alipay North America, told Bank Innovation:
Alipay and Stripe already had their existing relationship primarily focused on serving US merchants. With the expansion of our partnership today, we can now serve all of Stripe’s merchants in any of their geographical locations.
Our aim for building a global cashless society is only strengthened by this relationship with Stripe. It improves our capability of allowing a Chinese consumer using Alipay to shop from any merchant that is using Stripe today.
Stripe businesses can now display Alipay on their websites, meaning that customers in China will be able to shop on foreign sites without having to use a foreign card, according to an Alipay spokesperson.
Partnering with a business such as Stripe allows both Alipay and WeChat a key advantage in markets abroad especially over other, smaller competitors in China such as YeePay or Chinabank, which might lack similar resources for this type of expansion.
WeChat Pay is extending the hold on its 600 million active users outside of China, also announcing a partnership in Europe with payments provider service Wirecard today.