Apple is Planning to Bring Apple Pay to China
The talks between Apple and Alibaba about launching Apple Pay service in China began in May. Today, Apple moves much closer to bringing its mobile payment system to China. It is still unknown when the company is planning to launch its payment solution in China. However, Apple is obviously very much interested in expanding its business to China. So, Chinese consumers can be offered an alternative mobile payment method in the nearest future.
The point is that Apple has huge revenues in China. Company’s profit reports show that Apple sells more iPhones in China than in the United States. This means that the Chinese market has huge potential for the company. The demand for Apple’s iPhone is extremely high in China. If we analyze the company’s report revenues for the 3-rd quarter of 2015 then we will see that the Chinese market has brought $46.9 billion to Apple. It is about 27% of company’s revenues.
Apple Pay is a very popular mobile payment platform that allows people to pay for items on their iPhone. Initially, the payment solution was launched in the United States. It quickly gained the popularity among US consumers. Now, Apple wants to move into China.
No doubt that it makes sense for Apple to launch its Apple Pay solution in China. Nevertheless, the company will definitely have to overcome a lot of obstacles on its way to success. For example, Apple Pay uses NFC (near-field communication) technology. First of all, users need to connect credit cards to their iPhone. Afterwards, they can use the system to pay for products or services via credit cards. However, if Apple brings Apple Pay to the Chinese market it will have to deal with the state-owned credit and debit card operator – Union Pay. This means that online shoppers will have to pay huge transaction fees from each purchase. Obviously, this may become a big problem for the company in China. So, Apple will need to find an effective solution.
Apple is working hard to resolve this issue. So, the company is trying to establish the partnership with a well-known Chinese e-commerce giant, Alibaba. Alibaba has its own payment system - Alipay. A lot of Chinese consumers use this system for making mobile payments in the country. Alipay offers online shoppers different ways of paying for items. Moreover, Alibaba uses several authentication methods. Right now, Apple considers Alipay as an alternative to Union Pay.
The results of negotiations between Alibaba and Apple companies still remain to be unknown. However, it is quite clear that Alibaba is going to help Apple integrate Apple Pay into the Chinese mobile payments market successfully.
According to the information provided by Wenhui News, Apple has already registered its mobile payment business in Shanghai. The Wall Street Journal says that it is the first stage of bringing Apple Pay to China. If the company continues to develop its business in China successfully then it will certainly help promote economic growth in China.