By Annex Asia Publishing
Apple Inc. will kick-off its Apple Pay electronic payment system in China. The launch will take place in early February, and will work with the country’s big four state-run banks (Industrial & Commercial Bank of China, China Construction Bank, Agricultural Bank of China, and Bank of China).
The company may have reached an agreement with different government agencies that oversee electronic commerce and payment. However, they have hit a bump on the service fee. In the US, Apple gets 0.15% of all credit card operations, and 0.5 cents from debit card transactions.
Apple Pay runs on latest iPhone models, such as iPhone 6 and 6s. It works through physical contact between the device and a reader at the store’s counter, later validated by the fingerprint scanner incorporated on the mobile device.
The service comes to compete with already established services, such as Alipay, Wechat Wallet, and others. Nevertheless, Apple holds 12.2% of the mobile market, and it is expected to grow. Hence, there is opportunity for success.
In any case, Apple would be smart courting some local partners. Last year, Alibaba’s CEO Jack Ma declared that he would be happy to pursue cooperation with Apple on financial services.
There is still room for decisions. Apple’s move is interesting, as China represents the largest mobile market in the world. This play might be what the US company needs to boost its market share in the country after falling into the third place, behind Xiaomi and Huawei.
Sources:
http://www.wsj.com/articles/apple-pay-may-launch-in-china-by-february-sources-say-1448340287
http://fortune.com/2015/08/03/apple-third-place-china/
http://techcrunch.com/2015/08/03/xiaomi-retains-top-spot-in-chinese-smartphone-market/
http://blogs.wsj.com/digits/2015/11/24/how-mobile-payment-works-in-china/
ANNEX ASIA
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