Chinese telecommunications companies are now in a rush to tap into the lucrative mobile payments market currently dominated by internet companies.
China Telecom, the country's third-largest carrier by number of subscribers, was the first of the three major telcos to delve into mobile payments, establishing China Telecom Bestpay Co. in 2011. Bestpay, as it is popularly known, handled 770 billion yuan ($116 billion) in mobile transactions in 2015, the Global Times reported.
Bestpay is followed closely by China Mobile's service, which managed 600 billion yuan. On the other hand, China Unicorn was able to muster only 100 billion yuan.
However, despite them getting their licenses to operate mobile payment services since 2011, the three carriers have still to establish a foothold in the industry dominated by e-commerce giant Alibaba\'s Alipay, which handled a staggering 72.0 percent of the 9.31 trillion yuan worth of mobile payments in 2015. And while being a distant second, internet company Tencent's WeChat Wallet still managed to snag 17.4 percent of the market.
Nevertheless, Gao Hongliang, China Telecom BestPay's general manager, expressed optimism that they would still be able to catch up with the giants. "We expect to overtake them once the next generation of payment technologies replaces QR codes," Gao enthusiastically said in an interview.
QR (quick response) codes have been very successful in China for facilitating mobile payments. However, experts believe that biometrics-based payment schemes will supersede the technology within two decades.
For its part, China Mobile is looking to push near-field communication (NFC) technology as an alternative method for mobile payments.
Meanwhile, after establishing itself as the dominant player in the Chinese mobile payment market, Alibaba is now seeking to expand its services to other countries. The company has recently signed an agreement with French payments processing provider Ingenico to allow European merchants accept payments to them made through Alipay, the Financial Times reported.
Ingenico executive vice-president for Europe and Africa Jacques Behr said that the partnership will help Chinese tourists pay for services during their trips easier. Behr added that the deal also opens the door for European merchants to get a hold of sales to the burgeoning Chinese tourist population.