Visa Brings Cross-Border Apple Pay Transactions to China

Mobile payments are thriving in China, and now Visa cardholders will be able to add their cards to Apple Pay to make purchases at overseas merchants, both in-store and online.

Initially, this feature will be available only to consumers holding cards issued by some of China’s largest banks, including the Industrial and Commercial Bank of China, Bank of China, and Agricultural Bank of China. However, Visa is already planning to expand this capability to include cards issued by other institutions.

As a result, users in Mainland China will have another mobile payment option when traveling and shopping internationally. What’s more, Apple noted that Mastercard is preparing to launch similar cross-border functionality in Apple Pay.

Widespread Cultural Acceptance

Apple Pay is the leading mobile wallet in the U.S. by a substantial margin, with over 65.6 million users. This success is largely driven by the continued popularity of the iPhone in its home market.

While Apple has also led China’s smartphone market—until recently being edged out by Huawei—Apple Pay still accounts for only has a sliver of the country’s mobile wallet market, which is dominated by Ant Group’s Alipay and Tencent’s WeChat Pay.

These all-encompassing super apps each have user bases of approximately 1 billion users, driven in large part by China’s widespread cultural acceptance of mobile payments.

The Central Hub

Building on this success, both Alipay and WeChat Pay have expanded their service offerings and begun pushing beyond Mainland China.

For example, Alipay+ is a merchant payment acceptance solution with reach across the Middle East and Latin America. Last year, Alipay+ supported roughly 2 billion cross-border payments for a customer base made up largely of small- to medium-sized businesses.

Ant International also noted that it is working to integrate with additional domestic payment systems—such as the mobile payments services in Thailand, Indonesia, and the Philippines—and to export the Alipay super app model to these regions.

Although mobile payments systems like Alipay, WeChat Pay, and Apple Pay are not often mentioned among the players poised to reimagine cross-border payments, they could ultimately serve as central hubs for international transactions, much as they already connect payments, identification documents, and even tickets within a single platform.