Skip to Content
Smart cities

Tencent and Alibaba’s mobile payment war shows how far China is ahead of the US

June 15, 2018

The Chinese tech giants are dropping major cash to rise to the top in the country’s mobile payment battle.

The scale: In 2017, $15.4 trillion worth of mobile payments were handled by third-party platforms in China—more than 40 times the amount processed in the US. Alipay, owned by Alibaba, handled nearly 54 percent of those payments, and WeChat Pay, owned by Tencent, processed around 39 percent.

The cost: Holding onto market share cost Ant Financial, an arm of Alibaba, a pretty penny. The discounts and rebates it provided to keep people on Alipay contributed to an uncommon quarterly loss. Despite such efforts, though, WeChat Pay is gaining ground—it’s been cutting more and more into AliPay’s customer base each year.

Why it matters: It’s all about the data. Sure, transaction fees are nice, but market dominance over mobile payments mean companies can amass data on the largest number of people possible. That can then be used to pitch consumers other products, like loans or investment funds.

America is lagging: The US is dragging its feet on mobile payment adoption. Plenty of people’s smartphones have the capability—think Apple and Google Pay—but not many stores or services have gotten with the program. Starbucks stands out as an exception, accounting for around 40 percent of all mobile payments in America.

Keep Reading

Most Popular

Scientists are finding signals of long covid in blood. They could lead to new treatments.

Faults in a certain part of the immune system might be at the root of some long covid cases, new research suggests.

Large language models can do jaw-dropping things. But nobody knows exactly why.

And that's a problem. Figuring it out is one of the biggest scientific puzzles of our time and a crucial step towards controlling more powerful future models.

OpenAI teases an amazing new generative video model called Sora

The firm is sharing Sora with a small group of safety testers but the rest of us will have to wait to learn more.

Google’s Gemini is now in everything. Here’s how you can try it out.

Gmail, Docs, and more will now come with Gemini baked in. But Europeans will have to wait before they can download the app.

Stay connected

Illustration by Rose Wong

Get the latest updates from
MIT Technology Review

Discover special offers, top stories, upcoming events, and more.

Thank you for submitting your email!

Explore more newsletters

It looks like something went wrong.

We’re having trouble saving your preferences. Try refreshing this page and updating them one more time. If you continue to get this message, reach out to us at customer-service@technologyreview.com with a list of newsletters you’d like to receive.