7 of Alipay's biggest moves beyond China

By Daniel Wolfe, John Adams, David Heun, Kate Fitzgerald

January 27, 2017 10:20 AM

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Alipay's deal to buy MoneyGram for $880 million may be the centerpiece of its strategy to expand beyond China's borders, but it's not its first move in recent months. The Alibaba payments affiliate has already extended its reach in several other ways.

US President Donald Trump speaks after signing one of five executive orders related to the oil pipeline industry in the Oval Office of the White House in Washington, D.C., U.S., Tuesday, Jan. 24, 2017. Trump took steps to advance construction of the Keystone XL and Dakota Access oil pipelines while foreshadowing a "renegotiation" of terms and insisting that developers use U.S. steel. Photographer: Shawn Thew/Pool via Bloomberg

Shawn Thew/Bloomberg

Trump card

The MoneyGram deal does more than give Alipay a new line of business — the Dallas-based money transfer company also gives Alipay firm footing in the U.S. at a time when President Trump is at his most outspoken against non-U.S. operations.

Signage for Ant Financial Services Group's Alipay service, an affiliate of Alibaba Group Holding Ltd., is displayed on a payment machine inside a Sa Sa International Holdings Ltd. store in Hong Kong, China, on Tuesday, Nov. 1, 2016. The urgency to prepare regulatory environments for fintech is growing as banks begin offering digital services such as biometric authentication and as mobile-payment systems such as Apple Pay and AliPay are introduced around the region. Photographer: Anthony Kwan/Bloomberg

Anthony Kwan/Bloomberg

U.S. partners

Alipay's October 2016 partnership with First Data and its Clover Mini terminal, and Verifone's e355 mPOS device, marked the first time the Chinese payments scheme would be accepted at the point of sale in the U.S. The deal targeted the 2 million Alipay customers who travel to the U.S. each year.

Flight plan

Alipay is extending its collaboration with luxury travel retailer DFS Group to launch Alipay's in-store mobile payment service in its Honolulu International Airport store, and in the downtown T Galleria by DFS Hawaii store. The Honolulu deployment follows Alipay's launch at San Francisco International Airport, Los Angeles International Airport and Kennedy International Airport in 2016.

Blockchain ambitions

Alipay set a goal of quadrupling its user base — currently at 450 million people — within the next 10 years, and it sees blockchain technology as a key enabler of that. Ant Financial has raised more than $4.5 billion in series B funding, and plans to use that money to fund development across a range of emerging technologies including blockchain, biometrics, cloud computing and artificial intelligence.

South Korea

Alipay is reportedly working on plans to expand to South Korea through a partnership with a financial services partner. Hana Financial Group is one South Korean banking company that’s been discussed as a potential partner to expand Alipay’s reach in a market that already has a handful of mobile payment players, including Samsung Pay, Kakao Pay and Never Pay. Alipay has already laid some groundwork in South Korea, opening a customer service center in Seoul last year.

Social payments

In a move that could have given it digital reach beyond China, Alipay launched its own social messaging service in late 2016 — with mixed results. The social payment app, called Circles, made international headlines when it was briskly taken over by users selling adult content shortly after the app's launch. Alipay acted fast to scrub the service of racy photos for sale, and the incident now serves as a cautionary tale for any payments company dabbling in social media.