Global adoption of Chinese mobile payment services is on the rise as merchants look to attract Chinese tourist spending, according to a new survey released Tuesday by market research firm Nielsen along with Alibaba's fintech arm Ant Financial.
Why it matters: Chinese mobile payment giants including Alipay and WeChat Pay have been eager to cash in on the spending power of Chinese tourists traveling abroad.
- As its expansion in the US hits road bumps amid escalated trade tensions, Ant Financial has set its eyes on Europe and other markets like Southeast Asia.
- Ant Financial says it has more than 1.2 billion users worldwide.
Details: Overseas merchant adoption of Chinese mobile payment services rose significantly in 2019, driving a pickup in spending volume for Chinese outbound tourists, according to the report.
- The study surveyed a total of 4,837 Chinese tourists and 547 overseas merchants.
- Adoption of Chinese mobile payment solutions by overseas merchants accelerated during the year, especially in Europe. For example, 61% of the merchants surveyed in the UK said they adopted Chinese mobile payment solutions beginning in 2019.
- Overseas merchants surveyed said they were motivated to provide more Chinese-friendly payment services as 89% of Chinese tourists said they are more willing to spend when provided with familiar payment methods.
- Correspondingly, Chinese tourists' use of cash has dropped. For example, the amount of foreign currency exchanged by Chinese tourists prior to leaving for Europe fell 16% in 2019.
- Chinese tourists from lower-tier cities are an increasing segment of travelers abroad, and their level of spending overseas compared with tier-one dwellers is narrowing, the report said.
- Singapore, South Korea, Japan, Australia, France, Thailand, New Zealand, Canada, the UK, and the US were the top 10 most popular countries for Chinese tourists using mobile payments in 2019. The ranking was determined by the percentage of Chinese tourists that used mobile payments in a specific country during their most recent trip.
Context: Ant Financial's payment app Alipay invests in and forms partnerships with local companies in order to gain a foothold in overseas markets.
- In June, Ant Financial inked partnerships with five European e-wallet providers, which allows it to tap into merchants in 10 countries in the region including Finland, Norway, Spain, Portugal, and Austria.