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Walmart Switches to Tencent, Dealing Blow to Alibaba in China’s Mobile Payments Market

Update

In a statement to FN, a Walmart spokesperson confirmed the company’s switch to WeChat from Alipay. “On March 15, Walmart stores entered into a partnership with WeChat Pay in the western region,” she said. “This business decision is intended to help us offer the best all-round shopping experience for our customers.”

Noting that WeChat Pay is widely accepted and trusted in China, the spokesperson added, “Walmart is dedicated to providing customers with a high-quality and convenient shopping experience. Our stores offer multiple payment solutions, including cash, bank cards, prepaid cards and mobile payments.”

What We Reported Earlier

It’s a battle for the mobile payments sector.

U.S. mass merchant Walmart is shaking up China’s retail market by dropping Alibaba’s Alipay in favor of Tencent Holdings Ltd.’s WeChat Pay.

Watch on FN

The move deals a major blow to Alibaba Group Holding Ltd.’s Alipay, one of the country’s largest tech operators. Both Alipay and WeChat are vying for the top spot in China’s booming third-party mobile payments market. (The region itself includes provinces such as Sichuan, Gansu and Qinghai.)

Among the biggest foreign retailers in China, Walmart had been accepting Alipay in its more than 400 stores in the country. Although it didn’t provide a reason behind the switch, a company spokesperson said in an emailed statement to other news outlets that its partnership with WeChat stems from a business decision to improve customer shopping experiences.

“In the future, Walmart will cooperate with more partners to provide payment solutions with more convenience and benefits,” the spokesperson reportedly wrote.

In the mobile payments market, Alipay leads the race, with WeChat right behind. While Alibaba serves as China’s top e-commerce group, Tencent commands social media and is a majority shareholder in the country’s second-largest online retailer, JD.com Inc.

Both Alipay and WeChat payment methods can be used online and in stores by scanning QR codes with a smartphone. They can also be used in stores, restaurants, taxis and other services with the added bonus of user-targeted promotions and discounts.

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