Apple's Cook 'very bullish' on Chinese Apple Pay rollout, in talks with banks and AlibabaDuring a recent visit to China, Apple CEO Tim Cook said his company is moving forward with talks to roll out Apple Pay in partnership with regional banks and perhaps e-commerce giant Alibaba Group.
Cook told China's Xinhua news agency that Apple is actively negotiating with financial institutions to bring Apple Pay to Chinese consumers, reports Reuters.
"We very much want to get Apple Pay in China," Cook said. "I'm very bullish on Apple Pay in China."
As can be expected from China's booming economy, growing middle class and high saturation of smartphone owners, Cook believes an Apple-branded contactless payment solution is ripe for mass adoption. Currently, Apple Pay is limited to the U.S., though the company has plans to expand functionality beyond domestic borders as soon as possible.
While China holds the promise of great rewards, Apple faces a number of unique challenges that have so far stymied an official Apple Pay debut. Perhaps most troublesome is UnionPay, China's state-owned credit and debit card operator. Reports earlier this year claimed Apple was nearing an agreement with UnionPay over fees and restrictions, but forward progress stalled after talks supposedly broke down in February.
Another route is Alibaba's Alipay service, which could help Apple get a foot in the door with Chinese regulatory agencies. Last year, Alibaba confirmed it was negotiating a potential deal between Apple Pay and Ant Financial, the Alibaba subsidiary in charge of Alipay services.
While a dominant player in online payments, Alipay has yet to see success with its QR code-based point-of-sale transaction solution. Infusing Apple Pay's NFC and Touch ID technology into Alipay as a cobranded product could be a win for both companies, but major issues need to be settled before an agreement is ratified. For example, Apple's fees could prove too onerous for the Chinese market. In the U.S., Apple retains 0.15 percent of a 2 percent per payment fee charged to merchants, plus a half-cent per-transaction charge for debit cards.
Cook also took time to discuss Apple's environmental initiatives in China and voiced approval of recent news that iPhone sales surpassed that of local manufacturer Xiaomi.
On Monday, Cook activated an account with Chinese microblogging service Weibo, suggesting the Apple chief is looking to get a presence in the country.