Octopus Card company to join forces with Mastercard as it expands into realm of online shopping with new virtual prepaid credit card
- Under pressure from likes of AlipayHK and WeChat Pay HK, the Hong Kong firm is seeking to reinvent itself
- Card expected to have a maximum limit of HK$10,000
The company behind the Octopus Card e-payment system is to launch a virtual prepaid card for online shopping as it attempts to reinvent itself while facing punishing competition in the cashless transactions marketplace.
Sunny Cheung Yiu-tong, the CEO of Octopus Holdings, said on Wednesday the Hong Kong firm would join forces with Mastercard, and would issue the new payment option in the first quarter of next year.
Tying with the company’s e-wallet offering, O! ePay, the virtual card will require users to top it up with credit before it can be used for shopping online. The maximum credit limit is expected to be HK$10,000.
“The virtual prepaid card will bring us to overseas markets,” Cheung said. “As Hong Kong is developing into a smart city, the payment system needs to have choices and compatibility.”
Hailed as the pioneer in e-payment since it was launched in 1997, Octopus Card has seen its once dominant position threatened by the likes of AlipayHK, WeChat Pay HK, and Tap&Go.
AlipayHK is a joint venture between Hong Kong tycoon Li Ka-shing’s CK Hutchison Holdings conglomerate and Ant Financial, an affiliate of e-commerce giant Alibaba Group Holding. New York-listed Alibaba is the parent company of the South China Morning Post.
Cheung said the new card would not require applicants to give any proof of income, providing an alternative for those who experience problems when applying for credit cards.
Virtual credit cards, and virtual prepaid cards, are popular overseas in places such as the United States, Taiwan, and Japan, with the former functioning like credit cards, except payment of each transaction is settled through a one-time number or token.