Alipay, an Alibaba-owned mobile payments processor has partnered with Flutterwave, a pan-African payments firm located in SF and Lagos, Nigeria, in a move that will see Alipay link its 1 billion users to Flutterwave merchants in Africa.
China wants the whole of Africa and payments matter a lot. The Chinese behemoth has signed up Nigeria’s Flutterwave in a deal that will see Chinese tourists and merchants pay and receive payments with ease.
Alipay has been activated to all merchants using Flutterwave’s Rave account, therefore, Alipay’s 1 billion users globally can trade with Flutterwave accepting businesses in Africa and in the US.
Since inception, Flutterwave has set out to provide the complete payment solution for Africans to thrive in the global economy. The complete payment solution would first require interconnectivity within Africa, then connectivity from Africa to the world. Today’s announcement provides a seamless payment platform for use anywhere in the world.
Flutterwave is used by merchants in Nigeria, Ghana, Kenya, Uganda, Rwanda, and South Africa. The firm has connected merchants in these countries to each other and to the world starting from the US. Its latest integration with Alipay in China even gives its users more reason to smile as China is getting bigger in Africa and most African merchants do business with their counterparts in China.
The integration means a trader in Africa can trade with anyone on Alipay. Apart from Flutterwave, Alipay will need to sign up more players in Africa to allow its customers enjoy their time in Africa or whenever they pay an African merchant online.
“We started with the U.S already but you can’t connect Africa to the world without China,” said the firm in a statement. Alipay did this partnership for its clients traveling to Africa or merchants doing business with African merchants.
According to a report by the Wall Street Journal, China is a significant player for mobile payments in Africa not only because it does business with Africa but because mobile payments are mainstream on the continent. Compared to the US which saw $112 billion of mobile payments in 2016 mobile payments in China totaled $9 trillion in the same year via Alibaba and Tencent-owned payment platforms.
The Chinese are being offered more smartphone-based products such as loans, investments, and other financial products than anywhere else in the world. The Chinese, are also seeing less of old-fashioned coins and paper money as mobile payment has taken over by WeChat Pay and Alipay which command about 40% and 54 % of China’s mobile-payment market respectively.
WeChat and AliPay allow users to add money into their wallets then sue the cahs to pay for almost everything in China in less than three seconds cutting out bank cards and ATMs. China’s state-owned banks lost nearly $23 billion in card fees in 2015 as mobile payments had replaced cards and the annual fee loss is projected to be $60 billion by 2020.
The partnership between Flutterwave and Alipay comes at a time when both Tencent and Ant Financial Services are looking for partners globally to help them process payments for their clients when they travel the world. They want their customers to stay in the ecosystem regardless of where they travel to because transaction data and not just fees are important. Alibaba, an e-commerce giant needs that data to know what its customers are spending on.
To show that the world is important to Alibaba, Alipay’s parent firm Ant Financial put a failed bid to buy MoneyGram International, an international transfer firm with a 200-country network for $1.2 billion.