Huawai has gained a mobile payment license in China after buying Shenzhen Xunlian Zhifu Network from Shanghai Wo Rui Ou Information Technology Co., Ltd., China Securities Journal reported on Sunday.
Xunlian was founded and spun off by telco giant ZTE. In 2014, it was issued a nationwide license to provide payment services via its website or mobile phone. The license is valid until July 2024. Shanghai Wo Rui Ou bought the firm for RMB 382.5 million (USD 58.4 million) in August 2016.
Huawei has been in the mobile payment sector for years, leveraging on UnionPay’s mobile payment service, Yunshanfu. The Huawei Pay app, which launched in 2016, allows Huawei phone owners to pay for goods online, as well as in bricks-and-mortar stores and for bus rides even with the connection turned off.
The services are based on near field communication (NFC), a technology that hasn’t found many users in China, Zhang Yu, an analyst with iResearch, told KrASIA on Monday. “It is necessary for Huawei to hold a payment license since the company wants to provide more payment and other financial services,” he added.
Huawei will still promote its mobile payment services primarily within its own ecosystem, so it won’t impact Alipay or WeChat much in the short term, Zhang predicted.
“Huawei made this acquisition with the goal of offering a wider range of secure, easy-to-use smart services to enrich people’s digital lives in all possible scenarios,” a company spokesperson told KrASIA on Monday.
Before Huawei, tech companies including JD.com, Didi Chuxing, Meituan, Pinduoduo, ByteDance, and Kuaishou all acquired their own mobile payment licenses.