Stripe adds support for Alipay, opens China to western businesses
Closing the gap between China and the rest of the world, Stripe has partnered with Alibaba's Alipay to allow Chinese shoppers to make international purchases.
San Francisco-based startup Stripe has secured a deal with Chinese company Alibaba's third-party payment service Alipay in a partnership that opens up western businesses to what accounts for half of China's internet transactions.
Stripe offers businesses and individuals the ability to make payments easily over the Internet, similar to PayPal.
According to a blog post from Stripe, the company offers support for as many as 1 billion card holders using payment options like Visa, American Express, Mastercard, and PayPal -- but these options see little use in China.
"We're building a universal platform for internet commerce; in order to enable China's 1.3 billion people to buy from Stripe businesses, we decided to add support for Alipay," writes Christian Andreson, Stripe's lead engineer.
Making payments through Alipay is said to be frictionless on Stripe. While shoppers typically have to fill out a form on Alipay on another page, completing a payment on Stripe requires just an email address and SMS code at checkout.
Stripe's announcement comes on the heels of Alibaba's launch of its first US e-commerce site 11 Main, initially catering to local businesses that have specialty goods to sell.
Mobile payments are a burgeoning industry, with China seeing a 255 percent growth year-over-year to $623 billion (£367 billion, AU$664 billion) according to the People's Bank of China. But despite the wave of western businesses eager to capitalize on these Chinese users, partnering with Chinese payment solutions has traditionally been a tricky hurdle.
Western mobile payment competitor Fortumo has struggled to enter the Chinese market (it's the company's third attempt), and merely enables microtransactions in China despite having billing partnerships with carriers like China Mobile.
But the larger threat has been China's central bank, which has seemingly sought to enact state regulations on technological innovations in China. In March, it was reported that China's regulators proposed a spending cap of 10,000 RMB ($1,603, £944, AU$1,710) per month on transactions through mobile payment systems.
Stripe's Alipay program is currently in beta, but is said to be rolling out to all businesses over the coming weeks.