How to divide the trillions of big cakes? Mobile payment market staged "Three Kingdoms Kill"

Economic Information Daily reporter Zhang Mo Wang Qi intern Chen Siyu Cui Jing

The two giants of Alipay and Tenpay have fought together, and UnionPay wants to break out of the “return” market, and international payment giants actively deploy the Chinese market... The major institutions are vying for the mobile payment market with a scale of nearly 20 trillion yuan. According to the latest data released by Analysys think tank, in the first quarter of 2017, the transaction volume of China's third-party payment mobile payment market reached RMB 18,809.12 billion, an increase of 46.78%. Analysys expects that by 2019, China's mobile payment market will reach a scale of one hundred million yuan.

The rapidly expanding market, on the one hand, gives participants seemingly unlimited opportunities, on the other hand, fierce competition also brings infinite challenges. In the context of gradual opening up and stricter regulation, the pattern of China's payment market is also quietly changing.

"Two strong" hegemony

Cashless city strategy becomes a pivot

From the perspective of the Chinese market, third-party payment institutions such as Alipay and Tenpay have a large market share. With the strong expansion of Alipay and Tenpay, the development space of other third-party payment institutions is being squeezed.

Analysys thinks that the quarterly monitoring report of China's third-party payment mobile payment market in the first quarter of 2017 shows that in the first quarter of 2017, the transaction volume of China's third-party mobile payment market reached 1,889.1 billion, of which Alipay accounted for 53.7%. Futong is 39.51%, and the total of the two accounts for more than 90%.

Analyst Wang Pengbo, an analyst at Analysys, said in an interview with the Economic Information Daily that "whether it is Alipay or Tenpay, it is currently advancing its scene in the second and third tier cities, thereby increasing market occupation and product opening." Frequency. For example, Alipay is advancing its “cashless” urban strategy across the country. On June 28th, following Hangzhou, Wuhan and Fuzhou, Tianjin and Ant Financial signed a cooperation agreement, announced the joint promotion of Tianjin “cashless city” construction, and promoted the “Internet + government” wisdom upgrade. It is expected to gradually realize this year. Cashless in the fields of transportation, medical care, education, and social security. At the same time, Alipay launched the functions of electronic social security card and the Alipay life number and medical insurance in Hangzhou and Chengdu. In Shanghai Hongqiao Airport parking lot, Alipay also allows users to achieve “no feeling payment”. Innovations in these payment methods have also advanced the implementation of the “cashless” urban strategy.

From the perspective of Tencent, WeChat's user stickiness has increased the use of its mobile payments. In addition to the same “no cash” city benchmark, its main strategy is to combine with the industry to promote its “cash-free payment plan”, such as strengthening cooperation with Drip Tractors, Mobike Bicycles, and Meituan Takeaways. In addition, WeChat Pay also advocates the launch of “8.8 Cashless Day”, which is the world's first mobile payment festival. It hopes to call on netizens to use mobile payment to advocate a lower carbon and convenient green payment method.

“Alipay and Tenpay have their own advantages. Alipay has established a system and a series of financial platform strategies in the financial sector, backed by ant empire, such as Yu'e dynasty, personal wealth management, ant Jubao; and WeChat payment is social Advantage." Wang Pengbo said.

In addition, the competition between Alipay and Tenpay has also extended from the domestic market to overseas markets. Ant Financial launched the concept of “ant globalization”, including cross-border offline business, global payment global payment and global practice of inclusive finance. At the same time, in 26 countries and regions such as Europe, America, Japan, South Korea, Southeast Asia, Alipay's Alipay has access to more than 120,000 overseas offline merchant stores; and 2017 Spring Festival Golden Week, Alipay cross-border line The number of transactions increased by 5 times year-on-year.

In terms of TenPay, on July 3, the WeChat team held the first WeChat payment overseas opening conference in Tokyo, Japan. WeChat said that the current flagship store has been expanded to 100, and announced at the meeting that the WeChat payment platform is open overseas. Released the "WEPlan" cross-border payment product program. The data released by the WeChat payment team also showed that the peak value of single-day transactions in Japan in June was 40 times the peak in January, and the number of WeChat payments was 16 times in January.

UnionPay

Can "reverse attack" be tested

The “double giant” pattern is difficult to be shaken at the moment, but the domestic mobile payment market is also undergoing some obvious changes. The traditional financial institutions such as UnionPay and Bank have become more and more interested in the cake.

On the one hand, China UnionPay accelerated its exploration of its own transformation and development, and on the other hand, through the continuous development of various payment products through cooperation with external partners, these actions have shown its determination to “return” to the top spot in the domestic payment market. Different from Alipay and Tenpay's “scan code payment”, China UnionPay has strongly promoted NFC near-field payment methods, including card cloud flash payment and cooperation with companies such as Apple and Samsung to launch Apple Pay and Samsung in China. Pay and so on.

In fact, compared to scan code payment, NFC near-field payment can be realized without networking or opening an APP or waking up the screen, and because of the payment tokenization (Token) technology, the security is also high, but from In practice, although UnionPay has also been promoted through various marketing methods, the effect is not satisfactory.

Taking Apple Pay as an example, at the end of 2015, China UnionPay and Apple announced a partnership to launch Apple Pay in China. At present, one and a half years have passed. Although UnionPay and Apple have never announced the specific transaction data of Apple Pay, many industry insiders report that this emerging payment method is "thunder and rainy" in the Chinese market.

The "Economic Information Daily" reporter interviewed a number of Apple mobile phone users randomly. Some interviewees said that it is very convenient to use. In Apple Pay designated stores, a fingerprint can solve the payment problem. But more people say that although they are installed, they are rarely used, and they are more accustomed to using WeChat or Alipay. Some of the respondents used Apple's mobile phone but did not install Apple Pay. They also think that the current payment method is convenient enough.

In my interview with the Economic Information Daily, Dong Ai, the chief researcher of I Love Card, said, "The cloud flash payment based on mobile devices has put forward requirements for the mobile phone hardware itself. The mobile phone can only support the cloud flash payment if it has the NFC near-field payment function. Although it is more secure and the payment scenario is comprehensive, most of the public will not change the phone because of a feature."

In recent days, in order to make up for its shortcomings, UnionPay has once again exerted its strength, and more than 40 commercial banks have officially launched the UnionPay cloud flash payment QR code products. UnionPay said that another 60 commercial banks are stepping up testing and will soon be opened, and other major banks will be fully operational during the year. Xue Hongyan, a senior researcher at Suning Financial Research Institute, said that UnionPay's participation in scan code payment can quickly make up for the shortcomings in its online micropayment scenario, enhance customer stickiness and consolidate its advantages in large payment scenarios.

However, whether UnionPay can unite with the bank to achieve counterattacks remains to be tested in the market. Some insiders analyzed that Alipay and WeChat have invested a large amount of money through long-term online and offline activities, which have been subtly cultivating users' consumption habits. Now it has achieved initial results, and UnionPay now changes consumers' payment habits. Certain difficulty.

Dong Wei said frankly that UnionPay does face greater market competition pressure. "The time for the establishment of UnionPay and Alipay is almost the same, and it will not be two years before and after. However, when China Development Union has not fully stabilized its development, it has caught up with the rapid development of China Mobile Internet. Internet companies themselves are innovating fast, and payment companies It is relatively more traditional, and UnionPay is equivalent to being run by Internet companies," he said.

Some analysts believe that in the future, UnionPay should put more resources on QR code payment products. Wang Pengbo said that UnionPay's rapid introduction of two-dimensional code payment standards and related products has actually completed the first step. Next, UnionPay should jointly launch a two-dimensional code payment product and jointly expand important high-frequency payment scenarios.

However, Dong Wei said that UnionPay also has its own advantages, that is, the security standards for payment methods are very strict. "At the same time, UnionPay wants to break through various methods, it must be steady and steady, maintain the existing customer base, and always put the safety of funds in the first place." He said.

Market opening

International giants aim at the Chinese market

Along with the further opening of the domestic market, some international payment giants will also have the opportunity to make a big impact in the Chinese market in the future, which will bring more possibilities to the mobile payment market.

Prior to June 2016, in order to implement the State Council's “Decision on Implementing the Administration of Bank Card Clearing Organizations”, the bank card clearing market was opened in an orderly manner in accordance with the law. The Central Bank and the China Banking Regulatory Commission recently issued the “Administrative Measures for Bank Card Clearing Agencies”. The Measures stipulate that eligible domestic and foreign-funded enterprises can apply to become bank card clearing institutions. Just recently, the central bank recently released the “Guidelines for Access to Bank Card Clearing Organizations” (hereinafter referred to as the “Service Guide”) to further refine the application for the admission of bank card clearing institutions and preparations for the opening of the business. This means that the opening of the Chinese bank card clearing market to foreign capital has entered a practical stage.

The international payment giants represented by Visa and MasterCard have long been concerned about the changes in the Chinese market and are always ready to deepen their presence in the Chinese market. Before the RMB clearing license was obtained, the international card organization's business was concentrated in the cross-border payment field, and cross-border tourism and “haitao” business also became the focus of its layout. In the future, once the license is obtained, the depth and breadth of its business will expand.

The MasterCard said, "We are researching the Service Guide and look forward to leveraging our global payment network to provide a convenient, secure and intelligent payment experience for Chinese consumers and businesses." Yu Xueli, President of Visa Greater China, also said at the recent “World Mobile Conference Shanghai Station” held in 2017: “China is the world's largest mobile payment market and the most innovative and innovative market. Visa is looking forward to More excellent domestic innovative companies and individuals cooperate to create a local and global-oriented interconnected and innovative payment application to help the future business development."

There are many innovations in China's payment institutions, and even many innovations have already taken the lead in international investment banks, which has attracted the attention of international payment giants. For QR code payments, Chris Boncimino, senior vice president and head of digital solutions at Visa Asia Pacific, said, “Visa can rely on the advantages of its own network to make payment forms such as QR codes more merchants, financial institutions and consumers. The scale is based on standardization. Visa is willing to provide domestic industry with two-dimensional code standards that meet global industry standards, thus promoting the large-scale application of QR code applications in China and connecting with the international market. ”

Industry insiders said that the entry of international payment giants will be of great benefit to the Chinese payment market. Dong Wei told reporters: "With 15 years of development, China UnionPay has reached a certain level in both the amount of card issuance and its own volume, but to what extent the competitiveness has reached, it is necessary to conduct an inspection with international opponents. Visa Both MasterCard and MasterCard have a long history. Through competition with them, UnionPay should learn from each other's strengths and learn from their successful experiences."

It is worth noting that the entry of international payment giants into the RMB clearing market also means further competition between the “quartet model” represented by the card organization and the “three-way model” represented by Alipay. At present, both international card organizations and UnionPay adopt the “four-party model” (card organization, issuer, acquirer, merchant), but in China, non-bank payment institutions are directly connected to banks, bypassing card organizations for online payment, that is, adopting “three parties” mode". Last year, China UnionPay and Visa signed a memorandum of understanding on cooperation in Shanghai. The two sides will cooperate in payment innovation, payment security and financial inclusion. Both sides indicated that they will join hands to strengthen their adherence to the "quartet model."

Increased competition

"Innovation" and "security" seek balance

Analysys expects that by 2019, China's mobile payment market will reach 103,990.58 billion yuan. According to industry insiders, the competition in the mobile payment market exceeding 100 billion in the future will become more intense. In addition, while China's mobile payment market continues to innovate, the security issues associated with it have attracted more and more attention.

Fan Yifei, deputy governor of the People's Bank of China, said in a public speech that due to the virtualization of the Internet, the mobilization of payment services, and the diversification of participating entities, payment risks are spreading rapidly, concealing, long latency, and obvious spillover effects. The payment industry faces great pressure on sensitive information protection, customer fund security, and business continuity.

In this context, the regulatory authorities have also accelerated the lifting of the payment market in view of risk prevention. In terms of policy, in January this year, the People's Bank of China issued a new regulation, indicating that the customer deposits of third-party payment institutions were transferred to the central bank for supervision. In addition, starting from the second half of 2016, the central bank made it clear that in a period of time, new institutions will no longer be approved in principle, and the central bank will focus on the normative guidance and risk mitigation of existing institutions. In the recent period, a number of non-compliant, risk-free or unsubstantiated payment institution licenses have been taken back by the central bank.

In addition to cleaning up payment institutions and payment markets, the regulatory authorities are also pushing some industry standards and technologies to improve the safety index of the entire payment system. Last year, the central bank issued the "China Financial Mobile Payment Payment Marking Technical Specification", issued the industry standard for payment tokenization technology, and tried to prevent risks from the perspective of containing information leakage.

Regarding the strengthening of supervision, Wang Pengbo said, “The stricter the policy, the more popular the formal third-party payment institutions will be. At the same time, these policies will promote industry concentration, after the centralized deposit of deposits and strict supervision and implementation, Existing decks, second clears, or companies that survive on the interest of reserve payments will fade out of the market."

In addition, the network payment clearing platform (hereinafter referred to as the “networking platform”), which has attracted much attention, has successfully passed the staged production stress test in the past three months after the trial operation, and officially started the cutting. After the network platform is launched, the online payment channel of the payment institution will directly connect with the banks through the network connection platform. The fund clearing will achieve standardization, transparency and centralized operation, and the fund security will be further guaranteed.

The payment market is growing rapidly, and each market participant is carefully balancing between “innovation” and “security”. Yu Xueli said that “responsible innovation” is the principle that Visa has always adhered to. Security is not concession. What Visa has to do is not to consider how security is guaranteed after innovation, but to make security the first step in innovation.

The relevant person in charge of Alipay also said in an interview with the Economic Information Daily that since the establishment of Alipay in 2004, Alipay and Ant Financial have always paid attention to system transaction security and user information security. In 2005, Alipay advocated “You dare to pay me to pay compensation” and paid for theft of users. In 2014, Alipay launched account security insurance. Under Alipay's multiple security guarantees, Alipay's liability rate is currently about one in a million.