WeChat Pay exec hopes payments business can be ‘in all places’
A QR code for digital payment services WeChat by Tencent and Alipay by Ant Group, an affiliate of Alibaba Group, is displayed at a parking lot on December 27, 2020, in Yichang, Hubei province of China.
Wang Jianfeng | Visual China Group | Getty Images
Mobile pay took off in the last decade to become the dominant form of consumer payment in mainland China, surpassing cash and credit cards. Tencent’s WeChat Pay and Alipay — run by Alibaba affiliate Ant Group — are the most popular, covering the majority of the mainland population of 1.4 billion people.
But fierce rivalry between the companies meant that for years, consumers buying products on Alibaba’s Taobao e-commerce app could only pay with Alipay. That’s about to change, according to a Tencent executive.
“As for payment, we also hope in the near future, in all places, users can freely choose. It’s also a show of fairness,” Lei Maofeng, vice-general manager of WeChat Pay, referring to more platforms in China.
He was speaking in Mandarin Wednesday at CNBC’s annual East Tech West conference in the Nansha district of Guangzhou, China.
Lei did not name specific apps or share a specific timeframe, and did not respond directly to a question on whether WeChat Pay was in discussions with Alibaba.
However, Lei pointed out that WeChat announced Monday that users can now share links from external sites, including Taobao.
Previously, users of WeChat — the ubiquitous social messaging app in mainland China — could not directly share a link to a product on Alibaba-run Taobao. Instead, users could only copy and paste a jumble of keyboard symbols from a Taobao product page into WeChat. Copying and pasting the same combination of symbols into Taobao would bring the user to the product page.
A test by CNBC on Thursday found that the share function on Taobao now allowed users to send a product page link to WeChat — along with some promotional text.
WeChat is looking for other ways to keep users engaged with its app beyond mobile pay and messaging. These functions include automatically deducting a shipping charge once a courier has retrieved a package for shipment, eliminating the need for the user to pay manually, Lei told CNBC.
Several Alibaba apps, including food delivery app Ele.me and video platform Youku, have already started allowing WeChat Pay. Alipay was still the only payment option on Taobao and Tmall as of Thursday morning local time.
JD.com’s e-commerce app supported WeChat Pay, a domestic version of Apple Pay, and a number of Chinese credit cards as of Thursday morning. Tencent has a nearly 17% stake in JD, according to S&P Capital IQ.
Small business owners in China have complained in the past that an e-commerce site or food delivery app from one company would not allow them to operate simultaneously on another platform. Even if they managed to do so, the businesses might face higher fees.
Since late last year, the Chinese government has sought to limit alleged monopolistic practices by internet technology companies, notably by slapping a record $2.8 billion fine on Alibaba for such behavior.
— CNBC’s Arjun Kharpal contributed to this report.
Correction: The headline has been changed to accurately reflect that the executive who spoke to CNBC was from WeChat Pay. An earlier version misrepresented his title. Lei also said he hopes its payments business can be available on more platforms in future.