Travelers to China have flocked to Alipay since it announced the approval of 10 foreign-based mobile wallets in late 2023. In March, Alipay, which is operated by e-commerce conglomerate Alibaba, reported a tenfold increase in usage by foreign tourists compared to the previous year. The overall number of active users jumped sixfold.
The approved digital wallets are popular platforms from seven countries in neighboring Asia, including South Korea’s Kakao Pay and Thailand’s TrueMoney. The mobile wallet approvals brought an influx of new users to Alipay. Kakao Pay, for example, averaged 23.1 million monthly active users in 2023.
A Coordinated Effort
Alipay can now bind foreign credit cards to its platform as well. Earlier this year, it reported that visitors from almost 200 countries had used that functionality, with the U.S., Japan, Germany, and the UK among the top ten users.
The move to accept more foreign payment methods is part of a coordinated effort by the Chinese government to drive tourism, which declined after the country implemented stringent pandemic restrictions.
One barrier to travel has been the convenience and security of payments. Mobile payments have become the norm in China, where it’s commonplace to pay for everyday items by scanning a QR code. That singularity has made it difficult for foreign travelers to navigate transactions in the country. It’s a pain point China has worked hard to address as it aims to benefit from the increasing appetite for travel.
Protecting Personal Data
China also lightened restrictions on the amount foreign visitors can spend on Alipay before they have to register an ID. The limit is now $2,000 a year compared to the previous cap of $500.
That has made the platform more appealing, as tourists had been reluctant to share their personal data due to privacy concerns. Even though Chinese officials have encouraged hotels, restaurants, and attractions to accept foreign credit cards, travelers’ security concerns have put a damper on wide-scale adoption.
An extra layer of security is one of the major benefits payments platforms provide. It’s also one of the reasons Alipay has recently partnered with credit card providers like Mastercard. The payments platform’s security and convenience is only likely to bring more foreign travelers to the app, which already has more than 650 million monthly active users.