Earlier I wrote WeChat Pay + American Credit Cards: A Complete Guide (with a risk-control system overview). WeChat has opened up foreign card payments significantly, and even more merchants now support direct in-store QR payments. So how is its competitor Alipay doing?

Honestly, for readers in China, Alipay does not have much especially unique use. I’ll briefly cover it here. Overall, Alipay is still quite friendly to RMB use for Chinese users, with all kinds of red packets and promotions. Huabei is also a pretty good "virtual credit card." The whole financial ecosystem is fairly complete, including lending, insurance, mutual funds, stocks, and other financial services, but the breadth and depth of support for overseas credit card spending still need improvement.

Alipay registration

If you don’t already have an Alipay account, you’re welcome to register through our link and receive a red packet of a certain amount (requires a mainland China mobile number, 10 RMB): Alipay registration link.

Non-Tour Pass payments

Non-Tour Pass payments mainly include: direct payment in the Alipay app (including online redirects), Taobao/Tmall payments, and Fliggy payments.

Supported scope (excluding Tour Pass)

  • New: in-store QR payments are now supported, where the merchant scans you; no fee for now!
  • Alipay currently can only bind VISA/Master/JCB credit cards
  • The Taobao app supports VISA/Master/JCB/Discover/Diners Club and AMEX for some users
  • Only online payments are supported for now; offline payments are not supported yet (including any QR scanning)
  • These are currently not treated as overseas payments. The settlement party is in the US, so there is no foreign transaction fee (FTF) anymore
  • The app supports paying mainland mobile phone bills and the Fliggy mini program (mostly a 3% card fee, except for 12306)
  • Taobao, Tmall, and Fliggy purchases can be shipped to any address that can receive shipments, but a 3% fee is required
  • Buying high-speed rail tickets via direct redirect to 12306 or purchasing through the Alipay app 12306 mini program does not require the 3% fee

Reader Lester Hu found that the Taobao app can now be paid with an AMEX credit card. Screenshot attached:

  • Under normal circumstances you can’t add an AMEX credit card; conditions for triggering AMEX addition (YMMV):
Under normal circumstances, after switching regions and going to "Account & Security - Payment Management," then choosing "International/China Hong Kong/Macau/Taiwan Payments" under "Payment Method Settings," you still can’t add any foreign card under "My Bank Cards" (including Visa, Amex, etc.). The workaround is to use the foreign card you want to add to place one order; on the "Confirm Order" page, add that card information under "Payment Method" and complete the payment, and the card will then be bound. H/T: Lester Hu

Also, when KUKU tried it, they found the Taobao app already supports Discover and Diners Club credit cards (note: Alipay still only allows VISA/MASTER/JCB to be added). At checkout, choose international payment, and then you can add the corresponding credit card. Discover has no foreign transaction fee (FTF), but Taobao’s fee still has to be paid (3%), so at the moment only the first-year double rewards on Discover miles (sign-up bonus $100) can be "pretended to be lossless" for a little manufactured spend (2 x 1.5%).

Overall, the 3% fee on the Taobao side still has a big impact on user adoption. World Taobao seems to have a promotion waiving the fee when a user first pays with an overseas credit card, and during holidays it often launches $100-$10 promotions. Some items can also be shipped directly to the US, which is a small angle worth exploiting.

Although both are online purchases, Alipay seems to be intentionally opening up in-store payments as well. Interested readers can refer to this 101 update:

Purchase categories [subject to change, YMMV]

  • Travel purchases: Ali*www.12306.cn. 12306 transactions are special; whether you pay via a redirect from the 12306 App or through Fliggy or an Alipay mini program, they are all treated as Visa/Master travel purchases, and no 3% Taobao fee is required, but they are treated as overseas purchases. H/T: WeChat reader gy
  • Online purchases: Ali*taobao.com, Taobao/Tmall, and mobile top-ups in the app are all treated as online purchases [now categorized as Groceries, supermarket spending]. The billing address will show Taobao in the US, so there is no FTF, but a 3% Taobao fee (charged by Taobao) is required. If it is supermarket spending, it may trigger supermarket multipliers.
  • In-store purchases: in-store QR payments are supported, with no fee.

[Note 1] At the beginning, the billing address was in China, so you had to pay both the FTF (usually also 3%) and the 3% Taobao fee

[Note 2] Pay attention to whether the billing country changes before and after the transaction; to be safe, it is still recommended to use a card with no FTF.

Alipay in-store QR payments

[2020.5 update 2] Perhaps in response to WeChat Pay, Alipay has now also opened overseas credit card in-store QR payments (merchant scans you)! According to DP from our reader ivanchen, there is currently no fee. Note that only legitimate merchants can scan your overseas credit card; street stalls cannot. This DP is from Lao Sheng Chang Soup Dumplings (below), CSR recognized Cat as supermarket spend, triggering Chase’s pandemic 5X UR bonus. From the merchant info, the coverage should be broader than WeChat in-store QR payments, and the limit and sustainability should be better than WeChat’s.

If you have never used Alipay with a US card before, you may need to upload some bank information to obtain access, otherwise you may be declined. See this 101 update for unlocking instructions:

Alipay supports overseas credit card QR scanning. We mentioned this in several previous 101 updates [see 1, 2], and it turns out it really works now. Please share more DPs! What’s odd is that Tour Pass now charges a 5% fee, but this feature doesn’t charge one. When using it, pay attention to any fee information (if there is one, it should be prompted).

DP from ivanchen, merchant scans you, CSR supermarket category, pandemic 5x

WeChat is mainly used for dining or travel spending, while Alipay in physical stores is mainly used for supermarket purchases, and online is mainly used for online spending. From now on, you can directly earn all kinds of multiplied credit card rewards in China.

Credit cards suitable for linking

Where to link your card

  • Link directly in the credit card binding page in the Alipay app
  • On Taobao, Tmall, and Fliggy, you can choose international credit card payment before checkout

Recommended credit cards

  • For travel cards with bonus multipliers and no FTF, you can link them and use them to buy 12306 train tickets. Cards in this category include CSP (2X UR) / CSR (3X UR, and the fee can be reimbursed),
  • Credit cards that earn extra on online spending. Although there is a 3% Alipay/Taobao fee, they can also be linked for Taobao and Tmall purchases [these have FTF, unless used on the U.S. Taobao version; if you're using it domestically or on the Taobao website, that issue is avoided].
  • On the Taobao app, choose international payment and use the first-year doubled Discover miles credit card (sign-up bonus $100) [2 x 1.5%].

Example 1: The author used the Alipay 12306 mini program to buy a bullet train ticket, with no processing fee

If paying with CSR, the statement will show Ali*www.12306.cn, code as travel spending, and trigger the CSR's $300 reimbursement. Image from WeChat reader gy

Example 2: Buying plane tickets in the Alipay Fliggy mini program requires a 3% fee.

About fees

Except for 12306 purchases, for direct Alipay payments and Taobao/Tmall/Fliggy purchases, in most cases you will need to pay a 3% fee (non-FTF). Here are several situations where that can be acceptable:

  • Combined with the high-earning cards mentioned above
  • Considering that Taobao, Tmall, and Fliggy themselves have some hidden coupons, sometimes paying a little fee is still acceptable.
  • For small amounts, this fee can be ignored.
  • By paying a 3% fee to complete a credit card sign-up bonus, if the bonus is worth at least 10% and you cannot complete the spending requirement otherwise, taking a small loss can also be worth considering

China Taobao, U.S. Taobao, and cross-border Taobao

Taobao and Tmall have warehouses in the U.S. for some popular Chinese products, and there is also a U.S. Taobao where you can place orders directly. At the same time, you can also order from China Taobao and figure out how to ship it to the U.S., which is what we call cross-border Taobao shopping. We plan to write a separate guide for this section, and readers with experience are welcome to contribute.

  • The web version currently only supports Visa, MasterCard, and JCB credit cards.
  • The Taobao app currently supports Visa, MasterCard, JCB, Discover, and Diners Club. Some users also support AMEX (apparently targeted). At checkout, choose "International Payment" to add the corresponding credit card.
  • After completing one overseas credit card purchase, you may be able to add an AMEX card for checkout. H/T: reader Lester Hu

A brief note here:

China Taobao

  • China Taobao: https://www.taobao.com/
  • You can use a U.S. Visa/MasterCard credit card to shop and have items shipped anywhere in mainland China. Just choose overseas credit card payment at checkout.

U.S. Taobao

  • Taobao World version: https://world.taobao.com/ (if your IP is in the U.S., visiting this link will automatically redirect you to U.S. Taobao)
  • U.S. Taobao has quite a few deals, such as the U.S. card payment shown below, $100-$10, and the Lunar New Year goods $300-$30

Cross-border Taobao

The U.S. Taobao warehouse cannot possibly include everything you want, so you may need to buy from China Taobao and forward the package to the U.S.; that is what we call cross-border Taobao shopping.

Note: this section is not finished yet, and we will add more later.

Tour Pass

Starting from January 3, 2020, Tour Pass has a 5% service fee, so Tour Pass is no longer recommended!

Image from reader Eric

Tour Pass is a special case, so it is listed separately here. This section originally appeared in 101 News, original article: Alipay launches Tour Pass to counter WeChat foreign card payments. It has been revised based on actual experience. Since the author cannot use Tour Pass, readers who can use it are welcome to leave a comment and add more details.

To counter WeChat foreign card payments and compete for overseas users, Alipay launched Tour Pass, a prepaid program that allows foreign debit and credit cards to preload funds onto a stored-value card issued in cooperation with Bank of Shanghai, after which Alipay payments are made from that stored-value card, and it supports almost all online Alipay payments.

Registration requirements

  • You need an Alipay account registered with an overseas phone number,
  • You need to be an non-Chinese person who has completed ID verification. It also does not currently support users from Hong Kong and Macau; those users have a separate Alipay app.
  • Entry: In Alipay, search for TourPass and you should see it. If you have already linked your ID card, then you cannot enter this mini program.

Supported credit cards

Just like direct Alipay payments, it only supports Visa, MasterCard, and JCB, and does not support AMEX or Discover.

Top-up method

Currently, top-ups support a minimum of 100 RMB and a maximum of 2000 RMB. The balance is valid for 90 days, and you can top up multiple times. When it expires, the funds will be returned to your credit card. The funding card should, like Taobao, support Visa and MasterCard, with no fee and no limit on the number of top-ups; the current total cap is 2,000 RMB.

The first top-up prompts nationality verification

Credit cards suitable for linking with Tour Pass

  • Unknown (readers are welcome to provide information)

Don't use it anymore..

Spending

Just like WeChat, it uses the real-time exchange rate and there is no extra fee. It does not currently support in-store QR scanning (WeChat is much better at this right now), but it does support online spending and redirect payments.

Alipay's risk-control system

Using a U.S. card directly with Alipay

When paying directly with a U.S. credit card on Alipay, you can almost think of it as having no spending limit. This is a bit better than WeChat.

Using a U.S. card with Tour Pass

Top-ups have a cap, so there isn’t much to risk-control here. Restricting use by Chinese nationals is the biggest risk-control measure.

Spending Limits

The Alipay website provides an explanation. If you’re using it to pay for 12306, Alipay does not impose any additional restrictions. Spending limits elsewhere are as follows:

  • Per-transaction limit: 5,000 RMB
  • Daily spending limit: 20,000 RMB
  • Monthly spending limit: 100,000 RMB

Account Restrictions and Removal

Alipay used to let you use foreign credit cards pretty freely. As long as the amount wasn’t too large, payments would generally go through. Recently, Alipay has tightened its risk controls. In addition to the limits mentioned above, foreign-card payments seem to trigger pop-ups. For example, when using the Alipay app to top up a mobile phone, you need to enter mm/yy and CVV, and then you’ll see the following reminder:

At that point, you need to contact Alipay customer service to remove the restriction. The method came from reader ZY. I tested it, and it really is quite convenient. In the Alipay app, find "My Customer Service," then type human service. An agent will reply right away. The first-level agent may not understand foreign cards, so you can ask them to transfer you to the foreign-card payment team. After that, they will ask you to submit the relevant materials and send a link to the email address you provided.

You need to submit the following materials:

  • A front photo of the bank card used for the payment;
  • The bank statement (i.e. Bank Statement);
  • Identity documents (ID card/passport/driver’s license, etc.)
Based on Alipay’s review of your recent transactions, your Alipay account operations and transactions have been deemed to involve certain risks, and your account will be temporarily suspended. At present, your access to the Alipay account will be subject to certain restrictions. Please click the link and provide the following supporting documents: please keep the last four digits of the card number and your name, and cover the rest. All of the above supporting documents must be color scans of the original documents or clear, complete digital photos. Alipay staff will review them as soon as they receive them.

The only inconvenience is that PDF files are not supported, so you’ll need to take screenshots of your statement and send those instead.

After submission, you’ll receive a reply within three business days. It has to be said that Alipay’s customer service is much faster than WeChat’s.

Summary

  • WeChat and Alipay each have their strengths when it comes to foreign-card payments. Personally, I prefer Alipay. The downside is the fees and the limited number of supported categories.
  • WeChat supports a wide range of online and offline use cases, but its risk controls are a bit stricter.
  • Alipay’s overall risk controls are not very strict. The barrier of “restricting use of Tour Pass to Chinese nationals” could save an entire risk-control department. On the other hand, that is not friendly to many Chinese nationals living abroad long-term, and it also means fewer potential users.
  • Personally, I think Alipay is suitable for buying 12306 train tickets, especially CSR.
  • The new Alipay is suitable for in-store QR code scanning!

For using an American credit card on WeChat, see the article below:

https://www.uscreditcards101.com/wechat-payment-with-american-credit-card/