Apple Pay hasn’t even launched in China yet, and it’s already got some major competition from China’s biggest credit card company.
UnionPay Network Payments, a subsidiary of China UnionPay, has formed a partnership with U.K. startup Powa to bring a mobile payments system to market that would enable transactions via HCE and QR codes. The two companies have secured a 10-year deal.
Powa jumped into the mobile commerce space with its dongle (similar to Square’s) before it broadened its payments and commerce plans. Now, the plan is to focus on mobile commerce — targeting consumers who are shopping on the go.
“Our platform is a project which operates together with UnionPay Network Payment. Our mobile Internet products, O2O products and the POS system of China UnionPay connect together, speeding up integration and extending the capabilities of PowaTag,” chairman of the joint venture, Hu Jinxiong, said in a statement. “We have a target to reach at least 50 million consumers regularly using the platform within one year from launch.”
The difference with the UnionPay/Powa mobile commerce plan is that it intends to target the O2O market initially. Alternatively, Apple’s, Tencent’s and Alibaba’s mobile payments plans focus on physical POS transactions. That could be the next step for the UnionPay/Powa mobile payments play, according to Powa CEO Dan Wagner.
The partnership will involve UnionPay managing the payment processing side and Powa focusing on the technology involved in the O2O side with its PowaTag tech, which uses QR codes. It’s similar to Walmart Pay, which Walmart just introduced plans for.
This news comes on the heels of the announcement this week that UnionPay has launched, in conjunction with its partners, QuickPass, which is another mobile contactless technology-focused initiative.
QuickPass offers a mobile phone service solution that supports contactless payment technologies focused on NFC, HCE, TSM and token technologies.