Payments provider Stripe lands in Hong Kong as it partners with WeChat Pay, Alipay
US payments provider Stripe on Monday announced its entry into Hong Kong, as well as partnerships with Alipay and WeChat Pay that allows global businesses to accept these payment methods from consumers in China and the region.
Hong Kong is Stripe’s third Asian market – the company already has operations in Japan and Singapore.
Stripe, which is headquartered in San Francisco and has a valuation of US$9 billion, allows merchants to accept payments over the internet by integrating payment processing directly onto their website. This means that companies no longer have to deal with banks directly to set up a merchant account for accepting credit card payments, a process which can sometimes be cumbersome and expensive.
“Hong Kong is a natural market for us. It’s one of the main financial centres in Asia and also a very fast-growing start-up market,” John Collison, Stripe co-founder and president, said in an interview with the South China Morning Post. At 26, Collison is the world’s youngest self-made billionaire and is worth at least US$1.1 billion, according to the Forbes Rich List.
“That start-up market is very export-oriented and global. What we’ve seen in our beta tests in Hong Kong is that 60 per cent of the businesses built on Stripe actually have the majority of their sales overseas – they’re not just domestically-oriented, they’re globally minded.”
Two-thirds of venture-backed start-ups in Hong Kong, including companies like Grana, Tink Labs and Klook, are using Stripe to process payments, according to the company.
Collison said the partnerships with Tencent’s WeChat Pay and Alibaba-backed Alipay are a “natural part” of connecting businesses with customers, especially since consumers in China and the region are inclined towards e-commerce and mobile commerce. Alibaba owns the Post.
“The Chinese market accounts for half of mobile wallet spending globally, and you can’t ask for better partners [in WeChat Pay and Alipay] when it comes of the reach and the spending power they unlock.”
Over three quarters of mainland China’s online retail sales next year will be transacted on mobile devices, with the transactions forecast to be worth more than US$1 trillion, according to a recent eMarketer report.
But Collison does not view Stripe as merely a payments processing company. Instead, he believes that Stripe is “providing infrastructure for the internet economy”, and levelling the playing field for start-ups to compete with larger corporations as the retail landscape shifts online.
“For any of the hundreds of thousands of businesses built on Stripe around the world, they now have an additional 600 or 700 million consumers that they can reach. That’s transformative,” Collison said.
In the past, big companies would have payments experts and the global reach, which smaller companies could not compete with, he added.
“We’re gradually putting an end to that by continually adding more payment methods to Stripe, [so that] more of these economic links exist. Over time ... [we’ll start] seeing benefits of that international economic network really starting to accrue at these start-ups.”
Piruze Sabuncu, Stripe’s regional head for Southeast Asia and Hong Kong, said that there are many new consumers in markets like Asia that are going directly on mobile to buy the “latest and greatest” items, facilitating a shift to the cashless economy.
“If you look at the infrastructure available five years ago and now, there’s a major difference,” she said, adding that the payments and online retail space would similarly transform within the next five years from what it is today.