Alipay waives levy to drive mobile transactions

China's largest e-payment service will waive newly introduced levy on online transactions if these are placed via mobile devices, as it looks to drive more users for its mobile app.
Written by Eileen Yu, Senior Contributing Editor

Alipay will begin implementing a levy on online transactions but will waive this fee for payments made via mobile platforms, as it looks to encourage more users on its mobile app. 

A subsidiary of China's e-commerce giant, Alibaba Group, Alipay is introducing a levy of 0.1 percent of the total transaction value, ranging from 0.5 yuan (8 US cents) to 10 yuan (US$1.63). Previously, transactions worth below 10,000 yuan (US$1,632) were exempted from this fee, according to a report Wednesday on China Daily

This, however, would not apply for credit card payments and interbank transactions made via mobile devices, specifically, with the company's mobile app. "We will maintain free-of-charge services if users choose to go with Alipay's mobile app," it said. Alipay Wallet, the mobile version of Alipay, was launched in January and reached nearly 100 million users. The company added that one-third of its daily payments were transacted via mobile. 

Alibaba said it was investing 500 million yuan (US$81.6 million) to develop a mobile services platform to urge its merchants, selling their products on its e-commerce website Taobao.com, to switch to mobile devices. It added that it was targeting to increase the number of registered users of its mobile messaging app, Laiwang, to 100 million by mid-2014. 

Alibaba CEO Jonathan Lu said at a briefing last month that this would "funnel young and tech-savvy users to Alibaba's mobile ecosystem", providing the access to its e-commerce services and ensuring a stable stream of revenue. 

According to data by Analysys, Alipay had a 46.3 percent share of the Chinese online payment market in the first quarter of 2013, followed by Tencent's Tenpay which had 20.3 percent.

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