Alipay is the world's most popular payment service. China has quickly embraced the use of mobile payment services, with Alipay being the country's leading e-payment provider.
But you might not even have heard of it. So what exactly is Alipay and how does it work? Is it actually secure to use? And what benefits does Alipay have?
What Is Alipay?
Alipay is a free professional financial services app owned by Alibaba Group. It has an electronic wallet in which users can save their debit or credit card information and use it to make online or in-store payments.
It is also a money transfer app similar to Venmo, allowing users to send money from their mobile devices.
Alipay is a popular mobile payment app in China, working with both domestic and international financial institutions such as Mastercard and Visa. And with support for 18 different foreign currencies and active expansion in neighboring countries, its reach is expanding beyond China.
Apart from being an eWallet app, Alipay also offers other financial and social services to its users. In the app, users can buy insurance, order groceries, hail a cab, and even open a personal credit line. Alipay is classified as a super app due to its multifunctionality, which explains its widespread adoption.
How Does Alipay Work?
Because Alipay was designed for Chinese users and businesses, a Chinese bank account is required for long-term use. However, for foreigners visiting China, Alipay has a short-term feature called Tour Pass, which allows them to use its services for 90 days.
To use Alipay, you must first download the app and register, after which a digital wallet is created for you. To fund the wallet, users must link a credit or debit card.
This digital wallet can be used to pay for both online and in-store purchases, though the procedures differ slightly. On the online store checkout page, choose Alipay as your payment method. You will be directed to a new page with a QR Code; open your Alipay app and scan the code to complete your payment.
There are two methods of paying for goods or services in-store. The first method is known as the Merchant QR code method, and the second is known as the Customer Scan method.
In the Merchant QR code method, the cashier hands the user a QR code, which the user scans, enters the required amount, and submits. The Customer Scan method works the opposite way, with the cashier scanning a QR code presented by the customer to collect payment.
Is Alipay Safe to Use?
So far, the company's safety record has been satisfactory. There have been no reports of fraudsters or hackers gaining access to users' financial information.
To prevent unauthorized transactions, the mobile payment platform employs advanced encryption and a robust set of security features. It has a risk monitoring system that is constantly checking for suspicious activity in your account.
It also has a two-factor biometric authentication process to authorize payments. To use this feature, you must not only enter a password but also a biometric, such as a fingerprint or a face scan.
The app uses liveness detection software to distinguish between pictures of users and actual faces for the face scan, so you're protected even if someone tries to access your account with a picture of you.
For its users, Alipay has a well-known buyer protection system. This is enabled when you purchase products through Alipay rather than directly transferring funds to the seller. Alipay will hold the payment in escrow until the user confirms the product's quality before releasing it to the seller.
How to Make Alipay More Secure
While these features are convenient, you should take extra precautions, such as ensuring that no one other than the cashier scans your payment codes when using the Customer Scan method of payment.
Here are a few more safety tips to keep in mind:
- Before paying, confirm the Merchant QR codes to avoid paying the wrong person.
- Before making any payments, enable two-factor biometric authentication.
- Keep an eye on your account and report any unusual activity.
- Use one-of-a-kind, secure passwords and PINs.
What Are the Benefits of Using Alipay?
Using Alipay, particularly in China, has several advantages. These include:
- Security: Alipay is cashless, so you don't need to carry a large amount of cash when you're traveling abroad. Also, this reduces the risk of stolen card information.
- Quick payments: Paying with Alipay is quick because it only requires a PIN with biometric authorization. No swiping or counting wads of cash.
- Wide acceptance: Alipay is a widely accepted in stores globally. Users can pay for almost anything, and the app includes a slew of services, so you can sort out most of your everyday needs without requiring a third party.
- Convenience: The app is simple to use, and the fact that you only need to remember a six-digit PIN makes it even more convenient.
Frequently Asked Questions about Alipay
Here are some of the most frequently asked questions about Alipay.
Is It Possible to Use Alipay Without a Chinese Bank Account?
Yes, Alipay has a feature for non-Chinese users called Tour Pass. This is a 90-day service that allows foreigners, particularly tourists, to use Alipay with international banking information.
Can I Use Foreign Currencies on Alipay Instead of Chinese Yuan?
Yes, Alipay offers an international payment service that accepts 18 different currencies. Alipay accepts US dollars, Euros, and British pounds.
Is There a Fee for Using Alipay’s Payment Service?
Depending on the type of transaction, you will be charged a service fee. You will not be charged a fee if you transfer funds from your wallet to another Alipay account, but you will be charged a 0.1 percent fee if you transfer funds to a bank account.
Is Alipay Similar to PayPal?
Alipay is similar to well-known payment service, PayPal, in that they both use card-based payment systems. The only difference is that Alipay users who shop online can postpone payment to sellers until they receive the goods or services they paid for.
Can I Use Alipay to Pay for Goods and Services in Countries Other Than China?
Yes, Alipay has expanded internationally through a number of affiliate agreements. Stores, banks, and hotels, particularly in areas popular with Chinese tourists, have terminals and websites that accept Alipay payments.
Should You Use Alipay?
There's no real reason not to use it if you're visiting China. Alipay has embraced the Chinese cashless movement, and it appears that its reach will only expand in the future. Its platform is user-friendly, secure, and constantly expanding with new services and features. That results in it having over 1.3 billion subscribers and over 676 million monthly active users on average.
Take advantage of its offerings if you can, and keep security measures in mind at all times.