Owned by Alibaba, the e-commerce conglomerate, Alipay partners with over 65 financial institutions including Mastercard and Visa. It has over 400 million active users and holds the largest market share of the Chinese online payments market. In addition, Alipay has been the world’s largest mobile & online payment platform since 2014.
Alipay was created to provide payment processing services to Alibaba owned platforms like Tmal and Taobao, but it’s primary product is an e-wallet. This means it gives users a wide variety of payment options. It allows users to pay online and instore. It also offers one click recurring billing.
It reduces risk for shoppers by providing an escrow payment service. When a customer buys online using Alipay, the seller only receives the payment once the product has been delivered. Alipay are keen to encourage cross-border purchases. They deduct the payment amount from the buyers account account in real time in RMB and settle the payment with the merchant in the currency of their choosing.
To further encourage cross-border e-commerce, there is no need for merchants to set up a local entity or even a local bank account. This makes it one of the most popular ways for merchants to enter the Chinese market at it reduces costs.