WeChat Pay
WeChat Pay, officially referred to as Weixin Pay (Chinese: 微信支付; pinyin: Wēixìn Zhīfù) in China, is a mobile payment and digital wallet service by WeChat based in China that allows users to make mobile payments and online transactions. As of March 2016, WeChat Pay had over 300 million users.[1] WeChat Pay reached 1.133 billion active users in 2023.[2] WeChat Pay's main competitor in China and the market leader in online payments is Alibaba Group's Alipay. Alibaba company founder Jack Ma considered the red envelope feature to be a "Pearl Harbor moment", as it began to erode Alipay's historic dominance in the online payments industry in China, especially in peer-to-peer money transfer. The success prompted Alibaba to launch its own version of virtual red envelopes in its competing Laiwang service. Other competitors, Baidu Wallet and Sina Weibo, also launched similar features.[3]
History[edit]
In 2016, WeChat started a service charge if users transferred cash from their WeChat wallet to their debit cards. On 1 March, WeChat payment stopped collecting fees for the transfer function. Starting from the same day, fees will be charged for withdrawals. Each user had a 1,000 Yuan (about US$150) free withdrawal limit. Further withdrawals of more than 1,000 Yuan were charged a 0.1 percent fee with a minimum of 0.1 Yuan per withdrawal. Other payment functions including red envelopes and transfers were still free.[9]
In 2019 it was reported that WeChat had overtaken Alibaba with 800 million active WeChat mobile payment users versus 520 million for Alibaba's Alipay.[10][11] However Alibaba had a 54 per cent share of the Chinese mobile online payments market in 2017 compared to WeChat's 37 per cent share.[12] In the same year, Tencent introduced "WeChat Pay HK", a payment service for users in Hong Kong. Transactions are carried out with the Hong Kong dollar.[13] In 2019 it was reported that Chinese users can use WeChat Pay in 25 countries outside of China, including, Italy, South Africa and the UK.[11]
In the 2018 Berkshire Hathaway annual shareholders meeting, Charlie Munger identified WeChat as one of the few potential competitors to Visa, Mastercard and American Express.[14]
In 2021, the mandate by the Ministry of Industry and Information Technology (MIIT) to open up the "walled garden" ecosystems of the major tech companies has led to the introduction of interoperability of payment QR codes of WeChat Pay and competing Alipay and UnionPay's Cloud QuickPass platforms.[15]