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Walmart shelves Alipay in western China for WeChat Pay

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Walmart shelves Alipay in western China for WeChat Pay

Walmart Inc. has halted use of Alibaba Group Holding Ltd.-affiliated Alipay in western China in favor of Tencent Holdings Ltd.'s WeChat Pay, underscoring the ongoing battle between the Chinese tech giants to gain share in the mobile payments market.

The development came to light as customers made online posts of notices seen at several Walmart stores in the region. They read that the U.S. retailer had stopped accepting Alipay for purchases and would only accept WeChat Pay, Union Pay, credit cards, debit cards and cash as payment methods.

Walmart has more than 90 stores in western China, including in Sichuan, Yunnan and Gansu provinces and the municipality of Chongqing, according to its website.

A Walmart spokeswoman on March 28 confirmed the move with S&P Global Market Intelligence, saying the retailer had "suspended" acceptance of Alipay at its western China stores since March 15, after entering into a partnership with WeChat Pay for "exclusive offers and targeted marketing based on big data analysis."

The spokeswoman added that it was "a business decision," but declined to comment on whether Walmart's stores in other Chinese regions would adopt the same plan.

"Which third-party payment tool to use is determined by the merchants," Zhang Jun, Tencent's public relations director, said on his official Weibo account March 26. "WeChat Pay will provide merchants with a series of digitalization tools, while respecting their business privacy to gain partners' trust and recognition."

Alipay, which is operated by Alibaba affiliate Ant Financial Services Group, declined to comment on the matter.

Walmart's business relationships in China also include a strategic alliance with Alibaba's online shopping rival JD.com Inc., which was formed in June 2016. The retailer later raised its stake in JD to 12.1%, while Tencent remains the biggest shareholder in the Chinese e-commerce company.