Apple Pay is now available to use in China, with the mobile payments system now operational in the market two months after Apple reached an agreement with major Chinese bank card provider UnionPay to bring the service live in the major market. The latest market to be supported by the payment platform, the launch in China has been confirmed by the Apple developer portal, and follows after a recent leak detailing the timing of the launch.
According to Reuters, 19 of China’s largest lenders are onboard with Apple Pay, which means approximately 80 percent of credit cards and debit cards issued in the country will work with the service. It is claimed this also means Apple Pay can be used to make payments at around one third of all locations that accept the same payment cards, giving Apple Pay a good head start in the potentially lucrative market.
“We think China could be our largest Apple Pay market,” vice president of Apple Pay Jennifer Bailey told Reuters during the launch, though it is entering a market that already has similar services in operation, rather than a market that lacks competition. The China Internet Network Information Center claims 358 million people in China had already bought goods and services by mobile phone by the end of last year, a figure that is higher than the entire population of the United States.
Apple Pay’s two main competitors are owned by two of the largest Internet companies in the region. WeChat Payment is owned by Tencent Holdings, along with Alipay from Alibaba subsidiary Ant Financial Services, have operated in the market for a few years already, putting Apple at a disadvantage.
Even with the disadvantage, as well as the suggestion from one retailer that existing services make Apple Pay a “solution in need of a problem,” it still has a chance to make an impact on the market. Zhao Longkai, an associate professor of finance at the Peking University Guanghua School of Management, suggests Chinese banks and the state-owned China UnionPay disapprove of Alibaba and Tencent’s dominance, with Apple Pay giving UnionPay “an opportunity to bring a new alliance to defend the market it is losing” to the two competitors.
