Aussie taxi giant Cabcharge to accept payments through Alipay

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  • Cabcharge to accept mobile payments via Alipay
  • Company seeks to capitalise on burgeoning Chinese tourism in Australia

Australian taxi firm Cabcharge has announced that it will accept ride fees from mobile and online payments platform Alipay, capitalising on the fast-rising number of Chinese tourists visiting the country.

The new deal will enable Cabcharge to accept Alipay through payment terminals installed in its 20,000-plus fleet of taxis.

In taking the step, Cabcharge joins 8,000 other merchants across Australia and New Zealand who now accept Alipay, China’s most popular mobile payments service. The Australian Bureau of Statistics forecasts that over 3 million Chinese tourists will visit Australia every year by 2026.

Cabcharge is gearing up to compete with cab hailing platform Uber. The Alipay development signals its metamorphosis into a digital-savvy taxi firm to rival new upstarts similar in vision and scope. But it also indicates that China’s exploding e-commerce boom is having an impact on payment methods in Australia.

The vast majority of riders in China pay for cab journeys through a mobile payments app downloaded onto their smartphones – all they need to do is present their phone briefly to a QR code in the back of the taxi.

In fact, it’s not just cab rides that Chinese consumers are paying for like this. They pay for just about everything through China’s two most popular money transfers apps – Alipay and WeChat – and have come to take a predominantly cashless system for granted. So accustomed are they to the ubiquitous QR code, they often don’t know how to pay for a cab ride in Australia when they don’t see the familiar stickers to scan.

The Cabcharge-Alipay deal will be piloted initially with a limited proportion of cabs and then rolled out to the full fleet if it proves successful.

Cabcharge CEO Andrew Skelton told the Australian Business Review: “Chinese visits to Australia include tourists, business visitors and students and there is a growing pool of return visitors for whom taxi and hire car travel becomes natural. These customers use taxis at home and pay with Alipay.”

Cabcharge was taken aback by the rise of Uber in Australia, which made its offerings look outdated (poor service by comparison, clunky payment method). But under Skelton’s stewardship, the company’s earnings have returned to growth thanks in large measure to his technological improvements: customers can now book their rides through Cabcharge’s smartphone app (like Uber) and make contactless payments using credit cards.

The technology the firm utilises for the Alipay option was developed in-house for the Chinese intranational payments platform and will eventually include promotions and loyalty schemes (Chinese consumers are swamped with these offerings every time they use their smartphones to pay for anything).

On a somewhat less positive note, evidence suggests that drivers lose out with this payment method, as passengers are less likely to include a tip. Even so, with the Cabcharge technology, tipping is an option that riders are invited to consider.

The move could be a gamechanger, given the soaring number of Chinese visitors to Australia (there are approximately 165,000 Chinese students currently living in the country) and the fact that China is the largest mobile payments market on the planet. In 2016, its mobile money transfers tripled to RMB ¥38tn (AUD $7.6tn). That total is expected to have surged again in 2017.

Nigel Frith
Nigel Frith
Former Global General Manager
Nigel was the Global General Manager at FXcompared. Nigel has a background in marketing for businesses and consumers as well working in a variety of online financial services roles. Read more

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