Chinese tourists will soon be able to leave their cash at home when they hit the shops, thanks to an agreement between Commbank and popular Chinese payment service Alipay.

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Under the agreement the two companies plan to develop a payment solution to allow Chinese tourists and Chinese students to use Alipay for in-store payments at Australian retailers. According to Commbank, approximately 19,000 Chinese tourists visit Australia every week and spend almost $8,000 per person.

Alipay was developed for Alibaba’s marketplaces to keep cash in escrow before ecommerce transactions cleared, providing security for both vendors and buyers. In China, Alipay is today used to make money transfers, pay utility bills and make cashless purchases at retailers and restaurants making it the “de facto currency of an increasingly digital China,” according to Jack Ma’s biographer Duncan Clark.

Alipay was spun off from the Alibaba group in 2011 and is now operated by Alibaba affiliate Ant Financial services.

Under the terms of the Memorandum of Understanding (MOU) signed by CBA and Alipay, the two businesses will work together to make it easier for Australian consumers to pay for purchases made through Alibaba Group’s ecommerce websites, supported by Ant Financial’s payment infrastructure, including AliExpress, Alibaba’s English-language wholesale site.

It’s a new development in Alibaba’s strategy towards Australia. Since the Chinese internet giant opened an Australian office this year, Alibaba’s focus has largely been on encouraging Australian business to sell into China using Alibaba’s Tmall platform. Tmall is a B2C marketplace that provides foreign retailers the opportunity to sell online in China with lower barriers to entry than if they chose to set up shop independently.

According to Commbank, last year China overtook the US as the world’s largest market in mobile payments with a transaction volume of US$235 billion, and China is expected to process $6.3 trillion in mobile payments by 2020.

“Australia is a popular destination for Chinese travellers and Chinese students studying overseas. We want Alipay users to enjoy the kind of convenience they are used to at home. We are working with regional and global partners like CBA to make this happen,” said Douglas Feagin, Senior Vice President of Ant Financial Services Group and Head of Alipay International.

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Kelly Bayer Rosmarin, Group Executive, Institutional Banking and Markets, Commonwealth Bank said “We are thrilled to be the first Australian bank to collaborate with Alipay in building an innovative payments solution that leverages our leading ecommerce and point of sale platforms. We are constantly working on payment solutions that offer flexibility and choice for our customers so the prospect of bringing them closer to a globally leading mobile payments provider, and its 450 million active users, is truly exciting.”

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