As per latest information obtained, keeping in view long-term struggle to grip its business enterprises in China, mobile manufacturing giant, Samsung Electronics Co. has signed a contract with Alibaba Group Holdings Ltd.’s financial services affiliate to corporate with mobile payments determination.
In accord with an official press release statement, the companies revealed that Samsung Pay would operate with Alibaba affiliate Ant Financial Services Group’s *Alipay – valuing the privately-held company at about $60 billion (source: Market Watch).
Wall Street Journal reports that nearly 58% of all online transactions are handled by Alipay in China. The same report states that approx. 358 million Chinese consumers are already transacting via their smartphones, making it one of the most advanced markets for mobile commerce in the world.
(*which comprises more than 450 million active registered users)
INSIGHT: On overviewing Samsung’s No. 1 flexibility in China, it had rebound to position sixth after getting hit by domestic handset manufacturer’s i.e. Huawei Technologies Co., Xiaomi Corp etc.
EXCLUSIVE: An association with Alipay could yield a broader reach to Samsung in the current struggling market.
However, IDC’s senior market analyst, Michael Yeo leads a different approach here in this case:
“For Samsung users who have one of the Samsung Pay compatible phones, this isn’t a massive departure from what they can already do. It just means that the Alipay functionality will be available and quicker to use than if the user had to click into the Alipay app within the phone – maybe one or two swipes quicker. Samsung’s … falling market share of phones in China [will] ultimately lead to a lower potential user base which can effectively use Samsung Pay.”– Yeo
UPDATE: Not to mention, Samsung launched its Samsung Pay service in China at the end of March – five weeks after rival Apple launched its similar mobile payments service Apple Pay in the country.