With Douyin Pay (Chinese TikTok) ByteDance competes with Alipay and WeChat
ByteDance, the Chinese company that owns TikTok, has launched its own payment service for Douyin, the Chinese version of the short video app. The company also expands into the fintech and e-commerce sector in China
ByteDance, the Beijing-based company that owns TikTok, is looking to e-commerce and fintech with the launch of Douyin Pay.
While in the United States ByteDance has to contend with a ban by the Trump administration that forces the company to sell TikTok's U.S. assets for national security reasons, in China the company tries to expand into the digital payments sector.
ByteDance has launched a new payment service within Douyin, TikTok's Chinese sister app.
The short video app recently added “Douyin Pay” to its list of existing payment options, which include Ant Group's Alipay and Tencent's WeChat Pay.
With its payment service, ByteDance's Douyin thus joins the mobile payment giants Alipay and WeChat Pay, the two dominant mobile payment apps in China.
All the details.
WHAT BYTEDANCE HAS DONE
ByteDance has launched a new payment service within Douyin, the Chinese version of the TikTok short video sharing app.
Douyin users will therefore be able to choose Douyin Pay to make purchases within the app for short videos. Creators usually sell articles or products related to their content.
DOUYIN, THE CHINESE TIKTOK, BECOMES PAY
“Douyin Pay's setup is to integrate existing major payment options and ultimately improve the user experience on Douyin,” ByteDance said in a statement.
Douyin's payment system is operated by Wuhan Hezhong Yibao Technology, a company acquired by ByteDance about two years ago. Users will need a Chinese bank account to use Douyin Pay.
IN ADDITION TO ALIPAY (ALIBABA) AND WECHAT (TENCENT) OPTIONS
In fact, Douyin already offers payment options from Alipay, an affiliate of Alibaba, Ant Group, and Tencent's WeChat Pay, the two dominant mobile payment apps in China .
THE BYTEDANCE EXPANSION STRATEGY WITH DOUYIN PAY
Payment is a natural step for Douyin, who has a growing e-commerce business. Users can be directed to a product link while watching a video from an influencer reviewing it. Or they can purchase virtual livestreamer gifts or items from the stores on the platform.
The latest push to e-commerce and fintech highlights ByteDance's desire to expand beyond social networking.
However, as Reuters points out, ByteDance's expansion comes as Chinese financial regulators are tightening oversight over financial technology companies, as the Ant Group affair demonstrates. ( Here the in-depth analysis by Start on the non-listing of Ant and the regulatory tightening in China).
THE IMPACT ON THE MARKET OF DIGITAL PAYMENTS
China's third-party payments industry is dominated by Alipay and WeChat Pay, with the former taking 55.39% of the total market in the second quarter of last year, according to market researcher Analysys.
Other players include JD Pay, Baidu Wallet, and JD.com's Meituan Pay.
Together, Alipay and WeChat Pay account for more than 90% of China's mobile payment market, according to iResearch. Both payment services are available within the apps but also in brick-and-mortar stores where customers can scan barcodes to purchase items. This is different from Douyin Pay, which will only be available in the Douyin app.
Douyin's entry into the mobile wallet and payments scene could be significant as the platform currently has over 600 million daily users. According to South China Morning Post , ByteDance claimed to have helped more than 22 million content creators earn over 41.7 billion yuan (US $ 6.1 billion) in 2020 and hopes to increase the number to 80 billion yuan. ($ 12.3 billion) in 2021.
DUOPOLY OF ALIPAY AND WECHAT DIFFICULT TO BREAK
However, scratching the AliPay and WeChat duopoly will be tough on ByteDance, as TechCrunch points out. Other internet giants, such as e-commerce giant JD.com and food delivery service Meituan, have also tried to entice people to use their own payment methods but with little success as the market duopoly is difficult to break.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/innovazione/con-douyin-pay-tiktok-cinese-bytedance-gareggia-con-alipay-e-wechat/ on Wed, 20 Jan 2021 11:37:44 +0000.