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Apple Inc. (AAPL) And Alibaba Group Holding Ltd (BABA) Working on Alipay-Apple Pay Partnership

Apple Inc. (NASDAQ:AAPL) and Alibaba Group Holding Ltd (NYSE:BABA) could be closing in on a deal that will allow their mobile payment platforms to work closely together. The partnership would mostly work in China where Alibaba remains a key player in online transactions.


An agreement between the two companies would especially be of great benefit to Apple Inc. (NASDAQ:AAPL), which has continued to receive immense resentment from merchants back at home. The possibility of tapping into a market place that clocks millions in daily transactions is one of the reasons why Apple Inc. (NASDAQ:AAPL) is pushing for a close partnership of the two payment platforms.

Alibaba Group Holding Ltd (NYSE:BABA) vice chairman Joseph Tsai has already reiterated that positive talks are going on with finer details being worked out before a final agreement is reached. Alipay has not gained much traction as it ought to in China awaiting to see if a partnership in this case will accelerate its popularity.  Apple could, on the other hand, use this opportunity to tap into other markets outside the U.S.

The main concern at the moment has to do with the fact that an Alibaba-Apple pay could face immense scrutiny from regulators who have always maintained a hard stance in companies operating as a monopoly. Both Alibaba Group Holding Ltd (NYSE:BABA) Chairman Jack Ma and Apple CEO, Tim Cook have already shown strong indication that they are willing to intertwine the working of their mobile payment systems.

Apple Pay is to face stiff competition in China especially from state-run UnionPay that already has NFC payment terminals across the country. Alipay reportedly handled $200 billion in payments worldwide last year clearly highlighting its credential in online transaction compared to PayPal, which processed $180 billion. With over 800 million consumers using the Alipay platform for transactions, a partnership with Apple could be big in this case.

Apple Pay reportedly activated over one million credit cards just hours after going live, highlighting the amount of dominance Apple Inc. (NASDAQ:AAPL) and Alibaba Group Holding Ltd (NYSE:BABA) which is one of the Most valuable brands in China could command once an agreement is struck.

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