Alipay is losing ground fast to Tenpay. From a near-stranglehold of 80% of China’s mobile-payments market, Alipay’s share has steadily fallen to 50% with Tenpay rising from 7% to 40%. Both are now eyeing overseas markets to follow Chinese tourists and shoppers abroad.
“It’s like what happened in the 1950s when U.S. banks followed their corporate customers overseas,” said Paul Schulte, founder of fintech-focused consulting firm Schulte Research. “They are following their tourists, and they are following their commerce.” Conceived in 2004, Alipay fueled the first explosive growth in China’s online payments market, then the shift to smartphones within it. Mobile payments now account for three-quarters of such payments, up from 4% in 2012, according to iResearch data. Alipay says it has 520 million active users, many drawn in through Alibaba’s online marketplaces, like Taobao.