PayPal Battles Alipay for Mobile Payments Dominion


These days massive numbers of people in China shop online, which has led to far more people using online payment services. Services like PayPal have been around for many years, but when it comes to expanding into the Chinese market the penetration has been limited.

In China, AliPay is the leading third-party online payment platform offered by Alibaba Group, and would it would appear to be at the TOP of Mind on Chinese Market, because it offers a convenient, safe and secure way for millions of users every day to complete online transactions. When you are buying and selling, this escrow service helps protect your payments.

You can securely pay with your credit card without exposing your details. Alipay has declared themselves a leading global provider of mobile payments through mobile, in 2013 outperforming its chief competitor, the US based PayPal on the number of users and volume of transactions.

Differences between PayPal and Alipay

Alipay vs PayPal

PayPal currently battles for market share in China which is dominated by the massive Chinese e-commerce Alibaba company’s Alipay, which handles cross-border sales between foreign consumers and Chinese merchants, but PayPal isn’t in this very lucrative business that handles transactions between buyers and sellers in China.

Prior to making the comparison with PayPal, one has to understand consumer behavior in China and how they utilize Alipay. In China, there are 564 million internet usersthis is only 42 percent of the population, and almost all of these users possess a minimum of one credit card, and that number is increasing. Chinese citizens are huge savers and they prefer cash over credit cards, so this switch in ideology is a cultural phenomenon where you spend money you don’t have, rather than saving and buying something when you can afford it.

In China all of these transactions incur no costs. These services are secure and Chinese shoppers trust them, therefore there is a desire to use this service when shopping on foreign websites, and that is happening more frequently.

Mobile wallet

Alipay mobile wallet

At a quick glance PayPal and Alipay online payment services appear to be fairly similar. But Alipay actually offers a more integrated service than PayPal even though PayPal’s presence internationally is bigger.

Alipay can be used for everything with a simple press and that’s noteworthy. People use it to pay their bills, transfer money, add money to their phone account, check their bank balance, etc. Then they shop online and pay for their products with the same app.

It seems that PayPal can securely do all of these things and it appears that it’s used more as an escrow service when you shop online. In some places like Canada, America, or England, buyers are much more likely to use their credit card instead of using their PayPal account, which is linked to their bank.

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