Apple Pay is a good attempt at making mobile payments mainstream, but the fact remains that it is available only to limited countries and devices. While Apple has announced its plans to bring Apple Pay to China, there’s an Android rival already waiting in the wings – Android Pay.
According to Market Watch, China’s UnionPay is launching an Android-based payment app next year, which will be made available in China. UnionPay, which is the country’s largest credit and debit card provider already holds a strong payments network in China.
Wang Yanhui, director of Mobile China Alliance (MCA), told Want China Times, “There are more partners UnionPay can choose to produce the security recognition modules with and thus UnionPay may have greater influence on users than Apple Pay.”
Android Pay will work in a similar fashion as Apple Pay, using Near Field Communication (NFC) and fingerprint scanners. The only difference is that the service will work only on Android devices. Union Pay has reportedly approached domestic smartphone makers Coolpad and Lenovo for supporting the feature in their devices.
As reported by Reuters, China’s banking system is so complex that Apple relies on a top-up system to accept iTunes payments. It recently began accepting payments made using China’s UnionPay credit and debit cards to make things easier for users in Apple’s second-largest apps market. So it looks like UnionPay is in a better position than Apple to deliver a strong wireless payments service. Not only does it have a massive database of Chinese credit card holders, but it also has the power to influence retailers and other partners in China.
Note than UnionPay is also an Alipay competitor, which is a dominant player in the mobile payments market in China. Jack Ma, founder of Alibaba’s Alipay, spoke of his plans to work with Apple to introduce Apple Pay in China. A recent change in policies in China allows international payments processors such as Visa and Mastercard to enter the country, which could benefit the Alipay and Apple Pay tie-up.
If Apple Pay comes to China though Alipay, it will be interesting to see how the two payments services compete against each other.