This article disassembles Ant International’s Alipay+ business, shows the realization path of its vision of “one account global payment” through cross-border payment scenarios, introduces its wallet services, partner ecosystem and global digital network layout, and looks forward to the expansion of emerging markets and the development of digital finance.
The previous article dismantled the business map of Ant International, and some partners hope to see a more detailed introduction. Then let’s break down Alipay+, Antom, and WorldFirst business segments one by one.
Today we will introduce Alipay+, the core business of Ant International, this time we will first experience A+’s business from a cross-border scenario, and then disassemble Alipay+ in detail.
01 Global cross-border payment journey
The core goal of Alipay+ is to “connect the world and realize the vision of global payment in one account”, and we will show you how Alipay+ achieves a seamless payment experience around the world through a global tour.
1.1 Cross-border online payment
We know that RMB is subject to strict foreign exchange controls, but within the limit of 5W US dollars/year, as long as you apply for travel, study, medical treatment and other current items, you can exchange foreign exchange and cross-border payments. Then let’s start with a small outbound travel ticket.
1.1.1 Ticket purchase process for Korean tours
Tickets can be purchased directly online through Alipay (domestic version). To book local tickets in Korea, simply switch your location to South Korea and search for tickets, as these overseas merchants have joined Alipay+ (A+).
Figure 1: Overseas merchant information
Ticket services are provided by overseas merchants in South Korea, and you can book local tickets in Korea directly on Alipay. However, Alipay does not clearly display the specific country information of the merchant. (Just get used to it, Alipay will do “vague” processing such as the merchant’s country, acquirer, clearing agency, etc., for reasons we will talk about later)
Figure 2: Cross-border ticket purchase “cashier payment”
After placing an order to purchase tickets, the page will jump to Alipay for payment. After the user confirms the payment, the RMB will be converted into Korean won and paid to the merchant. After the payment is successful, the merchant issues a ticket. When traveling in Korea, show the QR code to get on the train.
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1.1.2 Cross-border acquiring capital flow
With Alipay+’s cross-border payment feature, the RMB on your bank card can be paid directly to Korea Railways. The specific process can be seen in the bill.
Figure 3: RMB to South Korean won
Consumers exchanged foreign exchange in real time during payment, and in the subsequent Alipay and bank bills, we can see that overseas merchants settle funds for him through acquirers.
1) Overseas merchants: On the Alipay bill, you can see that the money is paid directly in the form of Korean won to the merchant of the Korean rail ticket service called “Let’S Korail”.
2) Acquirer: The A+ in the bank statement (i.e.: Alipay Connetct PET LTD), he is responsible for deducting money from the consumer’s bank card and settling foreign exchange to overseas merchants.
Figure 4: Cross-border acquiring funding process
Unlike WeChatPay, which requires cooperation with overseas acquirers, merchants here directly settle in A+, and A+ completes the process of acquiring, exchanging foreign exchange and foreign currency settlement for merchants at one time.
1.2 Global In-Store Payments
After understanding cross-border online payment, let’s experience what cross-border offline payment is like. This time we can choose to travel to a country where Ant International does not have a direct location, such as Indonesia. In this way, we can see the complete clearing link.
Yes, Ant International has only one site in Southeast Asia, “Singapore Station” (AlipaySG), which radiates the entire Southeast Asia by cooperating with local service providers and banks in Southeast Asian countries.
1.2.1 Overseas in-store payment process
We arrived at an offline store in Indonesia, and now many regions in Southeast Asia support “Alipay/WeChat scanning code”, so after selecting some products, we will show the QR code to the merchant through the Alipay APP for QR code scanning payment (B scanning C).
Figure 5: Overseas in-store exhibition code payment
Let’s take a look at the bill and find an interesting thing, the bill shows that the RMB is exchanged for merchants in US dollars instead of local Indonesian rupiah (IDR).
Figure 6: Indonesian payments in RMB are settled in US dollars
The reason for Indonesia’s settlement in US dollars
1) Basic background:
Alipay only sets up a site in Singapore, and needs to settle with neighboring countries in Southeast Asia through local banks and PSPs;
2) Indonesian Regulatory Requirements:
Bank Indonesia stipulates that Indonesia can only use the rupiah for payment; Foreign exchange needs to be settled through a local bank in Indonesia.
3) The US dollar is the intermediate currency
Since there is no direct exchange channel between the Indonesian rupiah (IDR) and the Chinese yuan (CNY), the settlement between the Chinese yuan and the Indonesian rupiah is usually completed through the US dollar as the intermediate currency, forming a settlement path of “RMB→USD→Indonesian rupiah”.
1.2.2 In-store payment of funds
The capital flow of in-store payment is not as simple as online payment, involving payment paths and foreign exchange management requirements of various countries, and cross-border exchange and settlement between multiple institutions are required according to the central parity of the US dollar.
Figure 7: Cross-border exhibition code payment capital flow
1.2.2.1 Cross-border online transactions:
Merchants scan the Alipay QR code of Chinese users and are priced in Indonesian rupiah, local acquirers in Indonesia and Alipay+ are denominated in US dollars, while A+ deducts the Alipay account balance of Chinese users in RMB.
1.2.2.2 Cross-border fund clearing
The cross-border fund clearing process involves four main links, using the US dollar as the intermediary currency to complete the exchange and settlement:
- Wallet institutional deduction: Deduct RMB from the Alipay account of Chinese tourists.
- A+ to USD: Converts Chinese yuan to US dollars (CNY->USD) in Singapore.
- Indonesian Clearing Bank Processing: The next day, USD clearing is carried out between A+ and Indonesia’s local clearing bank, and the US dollar is converted into Indonesian rupiah. （USD-》IDR）
- Acquirer settlement: Local acquirers (sometimes clearing banks) settle with merchants in Indonesian rupiah. This layered delivery method allows global merchants to easily transact with Chinese consumers.
02 Introduction to the Alipay+ system
After watching the online and offline scenarios, you have a relatively preliminary understanding of the experience of A+ “one account, global payment”, and we will give a comprehensive introduction to the A+ system below.
2.1 One wallet travels the world
Alipay+’s strategic goal of achieving “one account global payment” consists of three parts.
1) C-end wallet: represents the C-end Alipay wallet APP;
2) Wallet gateway: represents a wallet gateway that links global payment service providers;
3) Global network: The basis for achieving the above strategies requires a set of global clearing networks to support it.
Ant has formed the main road of cross-border payment through the establishment of websites in major countries and regions around the world, accessing 33 local mobile partners through wallet gateways, and more than 300 acquirers radiating to 66 countries and regions, covering 90 million merchants.
Figure 8: Alipay+ business model
2.2 A: Wallet Service (Wallet APP)
Alipay is the C-end traffic entrance of Ant Group, which includes Alipay (domestic version), Alipay (international version), and Alipay Hong Kong (AlipayHK).
Figure 9: Comparison of the three apps
These three APPs can provide users with local life, cross-border payment and financial services based on the user’s real-name authentication country and geographical location, which is the so-called “thousands of people and thousands of faces” application services.
2.3+: Wallet Gateway (Partner)
Alipay users can bind global cards and local wallets for smooth online and local payments, thanks to A+’s wallet gateway. He integrates “mobile payment providers” and “acquiring payment providers” in various countries to provide merchants with unified “online payment” and “in-store payment” services.
Figure 10: A+ wallet ecosystem
2.3.1 Global Partners
A+ mainly serves payment institutions, which are not open to ordinary merchants, and enriches their local payment methods and payment products through these payment institutions. A+ divides payment institutions into two categories
1) Acquiring Service Provider (ACQP): A payment service provider that provides payment and settlement services for merchants, including global acquirers, local acquirers, acquiring banks, etc.
2) Mobile Service Provider (MPP), which provides consumers with mobile wallet payment methods, including wallet institutions, bank apps, financial service providers (enjoy now, pay later), etc.
2.3.2 Wallet Gateway Products
The wallet gateway is a local partner that connects to the A+ network to provide users with “online payment” and local “in-store payment” services.
2.3.2.1. Online Payment
Online payment products are integrated into websites and mobile applications in the form of “A+ plug-ins”, merchants use A+ plug-ins provided by acquirers to allow consumers to bind bank cards or complete payments through wallets, and the acquirer is responsible for settling funds.
Figure 11: Online payment products
1) Cashier Payment
It is a product that provides unified settlement through the cash register. A+ integrates the payment methods commonly used by consumers, and users can jump to mobile payment institutions to complete the payment after selection.
2) AutoDebit
It is a product that automatically deducts money after authorizing the binding of the bank card, and the user can make smooth payment after authorizing the binding on the merchant’s side.
2.3.2.2 InStore payment products
Figure 12: In-store payment products
In-store payment products are mainly scanning code business, including C-end display code payment and merchant scanning code payment products;
1) C-end display code payment (B scan C)
After binding the local wallet, the consumer displays the local payment code (Local QR Code), and the merchant completes the payment through the QR code scanner.
2) Merchant scan code payment (C scan B)
Merchants display QR codes, and consumers use Alipay APP to scan the QR code to pay. QR codes are divided into two types: static codes with business information and dynamic codes with order information.
2.4 Global Digital Networks
Figure 13: Global digital network
1) Connecting global partners (digital highways)
Ant International has set up 10+ sites in major countries/regions around the world, linking 30+ wallet service providers and 300+ acquirers through these sites, covering 66 countries and regions. Form a digital highway.
2) Core capital network (centralized operation of funds)
Global wallets and acquirers realize the centralized operation of global funds through the core fund network. It is said that its total transaction volume in 2024 will exceed $1 trillion, of which $300 billion will be cleared in real time through blockchain, and the exchange rate cost is one-tenth of that of traditional SWIFT (proper money printing machine).
3) Global regulatory adaptation (regulatory landing adaptation)
In order to meet the regulatory requirements of various countries around the world, Ant International adapts to the regulatory requirements of various countries through the wallets and acquirers it accesses. For example, online payment users need wallet service providers to do local real-name payments, while offline in-store payment uses local acquirer service providers and banks in various countries to acquire orders and settle funds according to foreign exchange and regulatory requirements of each country.
03 Global layout accelerates
Finally, let’s analyze the future development of Alipay+ and summarize its business development.
3.1 Two hot directions
1) The layout of emerging markets is accelerating
With the launch of Ant International’s new merchant acquiring service Antom, Alipay+ will accelerate the layout of emerging markets such as the Middle East, Africa, and South America.
2) Digital money printing capabilities take off
With the benefits of stablecoin legalization, asset tokenization can finally emerge for Ant International, which has been deeply involved in cross-border blockchain clearing for a long time. His global financial network “money printing capacity” will accelerate again, and there will be greater development in digital global trade and digital finance.
Finally, I will summarize the business development of Alipay+ as follows for your reference.
3.2 Alipay+ Business Summary
After nearly 10 years of polishing by Alibaba Group, A+ covers 66 countries/regions, 35+ partners, 90 million merchants, and 1.6 billion users. The focus is on Southeast Asia, Northeast Asia, Europe, and business in Latin America, Africa and other regions is also booming.
The summary of the business development is as follows
1) Business development
2) Application scenarios
【Reference materials for this article】
The information in this article comes from the official website of Ant International, public information on the Internet, and consultation from industry experts.
[1] Hidden Ink Stars: From Alipay+ to Antom
https://mp.weixin.qq.com/s/MnbXXLLu4DDMrCUDmxUZaA
[2] Ant International official website:
https://www.alipayplus.com/
[3] A+ Wallet Service Provider
https://www.alipayplus.com/mobile-payment-provider-list
[4] A+ Acquiring Service Provider
https://www.alipayplus.com/acquirer-list
