New Alipay Service Helps Western Companies Expand to China

Content Manager

Alipay, Alibaba’s online payment system, is providing more Western merchants a direct online sales channel to Chinese consumers, according to a blog post by the Alibaba Group.

Known as ePass, the new service combines Alipay’s cross-border foreign currency settlement capability with overseas delivery solutions from China Smart Logistics Network. It offers retailers access to e-marketing options from Chinese online ad network Alimama.

Jingming Li, president and chief architect of Alipay U.S., said in the blog post that through ePass, U.S. and European merchants can give Chinese consumers a way to purchase goods directly from a retailer’s existing standalone ecommerce website in their home markets.

Li said consumers are able to pay in Chinese juan through Alipay and have products shipped across borders directly to their homes through Cainiao’s network of delivery companies. Transactions are completed by purchasers using the Alipay Wallet mobile shopping app.

“We’re trying to make it easy for Western merchants to reach Chinese consumers without moving into China,” said Li.

Alipay is making it easier for Western merchants to leverage the ecosystem of Alibaba Group. Alipay, an affiliate of Alibaba Group, owns 48% of China Smart Logistics, a consortium consisting of major Chinese logistics providers with warehouses and shipping facilities in China and the U.S.

ePass merchants also have access to Alimama, which includes Alibaba Group’s B2C and C2C shopping websites and Taobao Marketplace and shopping search engine eTao.

Li said that with ePass, merchants can easily use Alipay’s infrastructure to tap into the China market.  With China Smart Logistics, he said, merchants  can just ship products to a freight forwarder in their home country.

“Chinese consumers in search of Western brands and products are increasingly shopping internationally, over the internet,” said Li. “This cross-border ecommerce is already a $40 billion business.”

Consumers are using online purchasing agents to buy products for them from English language websites and ship to consumers’ doorsteps. Using this system, Chinese buyers don’t know when they will receive the goods they have paid for, said Li. By purchasing overseas with Alipay Wallet, consumers receive shipping information including estimates of when their orders will arrive.

Alipay’s ePass does not require merchants to join the Chinese marketplace or translate its existing online shops into Chinese. In a recent Alibaba Group survey of Chinese cross-border shoppers,  nearly 80% of respondents said they used international websites in a language other than Chinese.  Forty percent said they could navigate these foreign websites independently without translation aids.

Li said the cost of ePass to merchants depends on the services used. Alipay typically receives a percentage of total transaction volumes. “If merchants want to receive more services such as shipping, the percentage is higher,” he said.