Mobile payments are picking up all over the world, although the Chinese market will be the most difficult to penetrate for most foreign companies. One of the first major players to bring their mobile payment solution to China is none other than Apple. Thanks to a partnership with China’s UnionPay, Apple Pay will soon be accessible to consumers all over the country.
Apple Pay Comes To UnionPay Cardholders
Pending approval of all regulatory and regulatory requirements, Apple Pay will become available to UnionPay cardholders as early as 2016, although no specific date has been revealed at this time. It should come as no surprise to find out that China will be one of the frontrunners as far as mobile payment adoption is concerned.
While there is nothing wrong with using traditional payment solutions such as cash or plastic cards per se, there are logistic and security issues associated with either option. When dealing with large sums of cash, money has to be brought to the bank and deposited in a safe on a regular basis. Card payments, on the other hand, are subject to fraud and chargebacks, as well as high transaction processing fees.
On the surface, Apple Pay will act as an innovative payment method although the same traditional payment solutions are being used. Apple Pay users can link bank accounts and plastic cards to the mobile app, and conduct contactless payments at eligible stores. As one would come to expect, the major struggle comes in the form of finding banking partners willing to let Apple Pay be used within certain countries.
By partnering with UnionPay, Apple has found a major player willing to work with them in bringing mobile and contactless payments to China, Introducing consumers to more secure, convenient mobile payment experiences is the main goal for both parties. As a result of this partnership, Apple Pay will be an accepted form of payment for hundreds of millions of UnionPay cardholders.
China is a booming market as far as smartphone adoption is concerned, and research estimates nearly seven in ten Chinese citizens own such a device. Furthermore, digital wallets are becoming more and more popular as far as paying for goods and services is concerned, and cash transactions are slowly on the way out.
Once the regulatory approval has come through, UnionPay cards can be added to Apple Pay, which is, in turn, available on iPhone, iPad and Apple Watch. Considering how UnionPay cards are accepted in 150 countries around the world – excluding China – and over 26 million merchants accept it as a form of payment, this is a major step forward for Apple Pay.
Digital Wallets – Including Bitcoin – Become More Popular
All over the world, consumers have been looking for digital wallet solutions. Very few of those products are gaining popularity, although there is a handful of exceptions. UnionPay’s digital wallet, for example, has proven to be quite successful so far. Apple Pay is another strong contender in this market, although its usage numbers have started to drop already.
But there are solutions outside of the traditional financial system as well, such as Bitcoin and other digital currencies. While mainstream adoption by both consumers and merchants is still lackluster where Bitcoin is concerned, the solution is gaining popularity all over the world.
Unlike these other mobile payment solutions, Bitcoin does not require regulatory approval or partnerships with banks to become accessible. With no central authority overseeing or controlling the Bitcoin network, users from all over the world can buy and sell goods and services to anyone else in the world at a fraction of the cost. Plus, any Bitcoin transaction will be completed within minutes, rather than days or weeks.
What are your thoughts on the partnership between Apple Pay and UnionPay? How will the mobile payment landscape look in China a few years from now? Let us know in the comments below!
Images courtesy of UnionPay, Apple Pay, Shutterstock