UnionPay Breaks Records Despite Threat from AliPay, Wechat Pay
2017-10-12
No country for old payments? UnionPay is trying to stay relevant at home and abroad
China’s Super Golden Week helped UnionPay break a new record, with the total transaction volume breaking 1 trillion yuan ($151.8 billion) during the holiday period October 1 – 8 to reach 1.37 trillion yuan ($208 billion). UnionPay attributes much of the credit for the new record to Chinese tourist spending, with its mobile QuickPass payment product as well as QR code payments responsible for significant growth. Even though mobile payment solutions such as AliPay and Wechat Pay have stolen most of the hype in recent years, it appears as if UnionPay’s place in Chinese tourist spending can’t be ignored.
UNIONPAY’S PLACE IN CHINESE TOURIST SPENDING CAN’T BE IGNORED
At one point understood as the key way to encourage Chinese tourist spending, UnionPay has slowly fallen out of favor as Chinese mobile payment providers such as AliPay and Wechat Pay have grown in prominence. In China’s mobile-first society, many retailers, small shops, and restaurants skipped past the card phase entirely, going straight from cash-only to mobile payments from AliPay and Wechat Pay.
The tremendous growth of mobile payments in China has raised concerns about whether UnionPay slowly fade into obscurity, and if getting point-of-sale terminals that accept UnionPay is worth the investment at all. If the next big thing for Chinese consumers, both at home and abroad, is mobile payments, then why bother with UnionPay?
IF THE NEXT BIG THING FOR CHINESE CONSUMERS IS MOBILE PAYMENTS, THEN WHY BOTHER WITH UNIONPAY?
UnionPay, meanwhile, considers itself “the first choice for Chinese outbound tourism”—certainly a strong sales argument in the past. With AliPay and Wechat Pay doing their best in conquering the world, the validity of UnionPay’s claims is increasingly getting questioned.
While slow to market, UnionPay is taking the battle with China’s other payment providers to their home turf: mobile. According to UnionPay, its mobile QuickPass payment feature saw transactions rise by 19 percent and transaction volume grow by 214 percent during Golden Week. The QR code payment feature it released earlier this year saw transactions grow by 50 times compared to the Labor Day holiday in the spring.
According to the company, Chinese tourists embraced these recently-released features during Golden Week, quoting Singapore and Australia as examples where its QuickPass payments grew by 500 percent. The transaction volume at overseas restaurants, supermarkets, and tourist attractions was also quoted as a significant source of growth.
Aside from its payment features, UnionPay also claims that its U Plan product has been incredibly successful among Chinese tourists. U Plan is a cross-border marketing platform that grants UnionPay customers “privileges” when traveling abroad, for example, retail discounts and coupon codes that can be used at partnering merchants at foreign destinations.
The message from UnionPay is clear: we’re still relevant, at the forefront of innovation, and accepting UnionPay payments is a proven way to encourage Chinese tourist spending.
ALIPAY ONE-UPS UNIONPAY WITH 800 PERCENT YEAR-OVER-YEAR GROWTH
While the growth in overseas payments quoted by UnionPay certainly is impressive, AliPay reported that their overseas transactions during Golden Week are up 800 percent compared to last year.
The battle over Chinese tourist spending is far from over, but UnionPay intends to do all it can to continue claiming that it is “the first choice for Chinese outbound tourism.”
Media Reports