A few days ago, media reports said that China's mobile payment industry with a scale of US$5.5 trillion was being subverted by Tencent.
As Tencent’s share in the market climbed to more than a third, Alipay’s market share fell to around 50% at the end of last year.
According to the latest data from Analysys, in the fourth quarter of 2016, Alibaba's share of China's mobile payment market was 54%, down from 71% in the third quarter of 2015. Tencent’s market share increased from 16% to 37% during the same period. Apple Pay, the mobile payment service that Apple launched last year, failed to rank among the top 10 in the Chinese market.
Why is Tencent’s payment so fierce? How will China’s Internet payment market develop in the future?
First, how does Alipay rise?
Alipay was developed along with the development of Chinese e-commerce. The history of online transactions is several years earlier than Taobao. The most entangled problem of the year was the first payment or the first one. After Taobao's development for a period of time, it launched Alipay on this issue.
Alipay first only played the role of a transaction intermediary, the user called the money to Alibaba, and then confirmed the payment after the goods were satisfied. This avoids the problem of the first scammer, and Ali's e-commerce has developed rapidly.
In the early stage of development, the user's Alipay itself has no balance. Everyone pays out from online banking. Alipay is only an intermediary.
Later, with the substantial liberalization of financial regulation, Alipay itself can store the balance, which has actually touched the deposit function of commercial banks.
Later, with the opening of the fast payment function, the rise of the balance treasure. Alipay balance treasure also has more financial functions. The monetary fund is networked, and at the same time, the liquidity of bank deposits has triggered the deposit to move.
In fact, at this time, Ant Financial has almost a full set of online commercial banking business.
Merchants of Ali E-commerce can obtain loans in Ant Financial, consumers can obtain consumer credit loans through ant flower buds, and ant Jinfu and credit cards are charged fees.
Under this virtuous circle, Alipay quickly became the leader of the online payment industry.
Second, why the WeChat payment is so fierce
WeChat is a very successful product, it firmly grasps the era of mobile Internet. Social and communication needs are just needed. Tencent has a QQ user base, and it is naturally smooth in the mobile era.
Unlike the PC era, Tencent has gained a larger user base because of the popularity of smartphones. In the past, there was no need for PCs, no middle-aged and older people with QQ, and the cultural level was relatively low. People with lower computer levels were also dragged into the mobile Internet circle by Tencent.
Therefore, WeChat payment has a natural advantage, that is, the threshold is low.
Alipay is developed along with Taobao. In the PC era, you will use Taobao, which means you have a PC, and you have broadband at home. You have basic computer skills and you will open online banking. (There is no quick payment in the early days), these are the thresholds.
WeChat only needs you to have a smartphone and a bank account. So when WeChat got involved in paying, the momentum of development was particularly fierce.
Alipay payment is a gradual process from the big business to the small supermarket. WeChat payment is explosive. WeChat has engaged in several red envelope activities to connect people to bank accounts. Then there is the natural historical process.
Nowadays, third- and fourth-tier cities can buy food in the free market, and they can already solve the problem without paying cash. Alipay is still a bit worse, some hotels and shopping malls are available, and the free market is not good.
The popularity of offline explosions, together with various online payment, and various APP purchases, is particularly fierce for WeChat payment. In just over a year, the market share has increased by 21%.
Third, the future of Internet payment who is floating
From the current situation, Alibaba's e-commerce advantage is still unshakable. And Ali has put all his business into Alipay.
In Alipay, users can purchase, can recharge, can pay utility bills, can call cars, can buy tickets, can repay credit cards. The most important thing is the deposit of the money fund, users can enjoy liquidity while enjoying higher interest rates.
Therefore, in the large expenditure of the family, Ant Financial Service still has an absolute advantage.
In the daily sporadic expenditure, transfer between people, instead of cash use, WeChat payment has a natural user advantage. This part of Alipay's market will be divided by WeChat.
After Alipay and WeChat develop to a stage, the share will be stable, and non-large subsidies will not change the pattern. Other payments will be marginalized. Includes Apple's Apple Pay.
With the development of Internet payment, the personal business of traditional commercial banks will also be divested, and banks are not interested in the cumbersome and profitable personal payment business.
Therefore, for a long time in the future, China’s Internet payment will be a situation of hegemony.
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