The potential Alibaba and Apple Pay partnership is looking good as negotiations between the companies are underway, AppleInsider reported.
Alibaba and Apple have had ongoing talks which have been “positive,” but no official agreements have been reached as details are worked out. Alibaba is looking to expand its payments system since its own Alipay hasn’t thrived in the Chinese retail market. An Apple Pay partnership would be mutually beneficial for the companies to help “gain foothold in the market,” AppleInsider reported, since Apple Pay is still limited to the U.S. market.
“Right now, I think what we can say is that this is focused on the China market for Apple,” Alibaba Executive Vice Chairman Joseph Tsai said in an interview with the Wall Street Journal.
“Tsai suggested that an Apple Pay-Alipay deal could use Alibaba to provide back-end services for Apple Pay, and users would pay for transactions with money from their Alipay accounts,” AppleInsider said. Alibaba and Apple Pay have had ongoing talks for about a month.
The hitch, however, comes from potential Chinese government backlash because of the state-run UnionPay that operates NFC payment terminals in China, AppleInsider said. Alipay has already experienced this issue and it could be a future hurdle for Apple if the partnership deal moves ahead.