Mastercard and Alipay Boost Cross-Border Payment Alliance

In 2019, Mastercard and Alipay initiated their collaboration, offering digital payment solutions for both consumers and merchants. Last year, they introduced another joint initiative aimed at facilitating cashless transactions for travelers in China, connecting Mastercard accounts with Alipay's digital wallet, writes PaymentsDive.

This extended partnership with Alipay, a subsidiary of Ant Group, comes after Mastercard obtained approval from the Chinese government in the previous year to conduct domestic operations within the country. Under this new authorization, Mastercard established a joint venture named Mastercard NUCC Information Technology, focusing on bankcard clearing, as outlined in a November press release.

As the second-largest U.S. card network, Mastercard is increasingly venturing into cross-border payment services, directly competing with traditional remittance firms like Western Union and MoneyGram. In this realm, Mastercard faces competition not only from established players but also from emerging entities like Remitly, which has formed a partnership with Visa, a major competitor of Mastercard (Mastercard is also allied with Remitly).

According to Mastercard's statement, consumers are showing a growing preference for digital cross-border payments over traditional in-person methods, driven by the need for rapid and secure money transfers, coupled with the assurance of successful fund delivery. Dennis Chang, President of Mastercard's Greater China Division, emphasized the significance of China as a major recipient of international remittances worldwide. He anticipates a surge in demand for cross-border payments as global economic activities continue to rebound.