The biggest combatant is Ant Financial Services Group, an affiliate of e-commerce giant Alibaba Group Holding Ltd. and the owner of China’s dominant Alipay service. Alipay lets users pay for everything from haircuts to houses via codes generated on their smartphones, instead of cash or cards. It is facing off against Tenpay, a similar service attached to WeChat, a popular messaging platform run by Chinese social-media firm Tencent Holdings Ltd.
Alipay is losing ground fast. From a near-stranglehold of 80% of China’s mobile-payments market by transaction value in mid-2014, Alipay’s share has steadily fallen to just above 50% at the end of June, according to data from research firm iResearch.
Tenpay’s share has risen to 40% from 7% over the same period, buoyed by WeChat, which has extended its chat functions to allow friends to split dinner tabs, square small debts and more. Chinese spend a third of the time they are on smartphones using WeChat, and that number is rising, surveys show.
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