Samsung partners with China's Alipay

A casher scans Alipay's QR code on a shopper's mobile phone at a supermarket in Hangzhou, capital of Zhejiang province. LONG WEI / FOR CHINA DAILY

Agreement is the latest move by a foreign player to win share in the largest smartphone market

Samsung Electronics Co Ltd has struck a partnership with Chinese payment service Alipay, to expand Samsung Pay in the world's largest smartphone market.

Currently Alipay is a separate app on the devices. When customers pay, they need to open the Alipay app, then scan a QR code provided by the retailer.

But Samsung Pay users are now able to link to their Alipay accounts and access to Alipay's QR codes to make payments, without separately opening the Alipay app.

Samsung officials hope that by using Samsung Pay more directly, it will increase the popularity of the South Korean company's payment technology in China as it battles US rival Apple Inc.

Samsung Pay was launched in China in March, a month after Apple Pay.

Run by Alibaba Group Holding Ltd's finance arm Ant Financial, Alipay is by far China's largest payment service with 450 million active registered users.

"The cooperation with Alipay provides us with a new application scenario, and also offers a more efficient payment method for users who are accustomed to Alipay," said Wang Tong, president of Samsung Electronics' product strategy and R&D in China region.

With domestic internet giants Alibaba and Tencent Holdings Ltd still largely dominating mobile payments in China, the agreement is the latest move by a foreign player to win market share.

Last December, both Samsung and Apple signed deals with China UnionPay, the country's biggest bank card association.

Sandy Shen, research director at internet consultancy Gartner Inc, said the agreement was a good way for Samsung to expand its business in China.

"Before it was only working with China Unionpay and covered merchants with POS terminals. Alipay also covers small and medium merchants that don't necessarily have a POS, so this will increase the number of merchant locations that accept Samsung Pay."

Shen, however, added that the cooperation is unlikely to have any major impact on the mobile payment market as a whole.

"The payment experience is not significantly better than Alipay or other digital wallets, and it still requires people to buy new phones to use Samsung Pay, which still has a relatively small user base."

Transactions completed through third-party mobile payment platforms reached 11.8 trillion yuan ($1.8 trillion) last year, a jump of 46.9 percent year-on-year, according to iResearch Consulting Group. Alipay was responsible for 68.4 percent of that and Tenpay, Tencent's alternative, which handles payments for WeChat, took 20.6 percent.