Why Apple and Samsung Have Already Lost the Mobile Payments War in China

Thursday, March 17, 2016

If you’re a smartphone company – even a big, successful one – looking to get into the Chinese market with your own mobile payments system, here’s a piece of advice: don’t.

Over the last month, we’ve seen Apple Pay, Samsung Pay, and even Huawei Pay enter mainland China. There are reports that Xiaomi, ZTE, and Lenovo are working on their own services as well.

Who asked for these? Not ordinary people. Chinese phone owners themselves overwhelmingly use Alipay and WeChat Wallet, created by web giants Alibaba and Tencent, respectively. And for good reason. It’s more than brand loyalty or even convenience – they are genuinely better products than their competitors, with more advanced features and better incentives to keep coming back.

You’re doing it wrong

In many countries, “mobile payments” means paying for things on your phone, and nothing more. That’s why most payment providers are essentially just virtual wallets holding your credit cards. And in places like America, this makes sense – customer loyalty programs, airline miles, discounts and the like are all handled by credit card companies, and mobile payments providers simply have to create a sleek, digital way for users to get to those same programs.

Source: Tech in Asia (link opens in a new window)

digital payments, fintech