Apple Inc launched its mobile payment system in China on Thursday in a bid to convince the hundreds of millions of users of the country’s entrenched, dominant services to switch.
“We think China could be our largest Apple Pay market,” Jennifer Bailey, vice president of Apple Pay, told Reuters in an interview in Beijing.
In an early boost, China’s biggest lender, Industrial and Commercial Bank of China Ltd (ICBC), was among the banks that said earlier this week that customers would be able to use Apple Pay from Thursday.
However, Apple Pay has not had an easy ride so far in China, the fifth country to get the service. Even in its U.S. home market, Apple has faced skeptical retailers in its effort to develop a new revenue stream.
China is not likely to prove any easier to crack.
“People switch applications for significantly better experiences, it (Apple) has to deliver not just a little bit more secure, or a little bit easier to use,” said Mark Natkin, founder of Marbridge Consulting.
Greater China is Apple’s second-largest market by revenue, and the world’s biggest smartphone market. By the end of 2015, 358 million people, more than the U.S. population, had already taken to buying goods and services by mobile phone, according to the China Internet Network Information Center.
The vast majority are using payment services from China’s two biggest Internet companies that have existed for years.
Social networking and gaming firm Tencent Holdings Ltd operates WeChat Payment, and e-commerce company Alibaba Group Holding Ltd, through its Internet finance affiliate Ant Financial Services Group, runs Alipay.
“With 100 percent saturation of local payment systems, no one in China is clamoring for Apple Pay,” said one retailer who declined to be named for fear of harming business prospects. “Today, everyone has a local payment option on their phone, so Apple Pay is a solution in need of a problem.”
Source: Apple Pay takes on China’s internet kings in mobile payments | Reuters
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