A new study from Juniper Research (www.juniperresearch.com) highlights the increasing dominance of Chinese companies in digital payments, with players such as Alibaba, Tencent and UnionPay seeking to bolster their revenues through international expansion.
According to the research group, digital payment transaction values are expected to reach $5 trillion by 2021, up from $3.6 trillion this year, of which $3.4 trillion will come from sales outside mainland China.
The report, which identified a series of key strategic approaches for players across the digital payments market, argues that both Alibaba and Tencent are keen to capitalize on the growing spend by both Chinese tourists and immigrant workers, now worth over $200 billion per annum. Potential game-changing decisions are Alipay’s move to roll out instore payments in Europe and Tencent’s efforts to deploy its WeChat wallet, which processed more than $1.2 trillion in domestic payments in 2016, across international markets.
Meanwhile, UnionPay is seeking to position itself as an alternative to Visa and Mastercard in a number of markets, notably Russia. According to research author Dr Windsor Holden: “UnionPay is struggling to gain domestic traction behind Alibaba’s Alipay, which is able to bypass UnionPay’s network when mobile payments are processed to offline merchants. Hence its focus is increasingly on building traffic from cross-border and international transactions.”
The research includes the latest Juniper Leaderboards, highlighting best-in-class players in key payments arenas, including PayPal (for eWallets), Worldpay (for payment service providers) and Vodafone (for telco payments in emerging markets). Meanwhile, it pinpoints the blockchain B2B solution developed by Chain and Visa as a transformative deployment for cross-border settlement in terms of transaction speed, transparency and accountability.