In recent years, Alibaba and Tencent have taken their payment apps abroad for fresh growth, announcing billions of dollars in deals to partner with foreign payment networks, and acquiring stakes in local financial technology startups. Their ultimate goal: Convince shoppers worldwide — starting with Asia and eventually in the U.S. — to use digital wallets under their control for all sorts of purchases, paving the way for them to provide more lucrative offerings such as online loans, insurances and wealth management products.

Such a scenario is already a reality in China. Alipay, developed by e-commerce giant Alibaba’s affiliate Ant Financial, already boasts 520 million users, while Tencent’s TenPay counts 400 million. Both are fast replacing cash and bank cards to become the payment of choice in the world’s most populous country.

Users can also obtain loans, buy money-market funds, and invest in a myriad of wealth management products in these two apps, which collectively control more than 90 percent of China’s $5.5tr mobile payment market, according to Beijing-based consultancy iResearch.

Follow the tourists

Now, the companies have started their overseas expansion by following China’s digital savvy shoppers, the root of their success at home. Both chose to first introduce their payment apps in places such as Japan, Thailand and South Korea, “following the natural flow of Chinese tourists,” said Paul Schulte, founder of Hong Kong-based consultancy Schulte Research.

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