>> It's getting harder to find people carrying cash on the streets of China. With mobile payments making up more than a trillion dollars worth of transactions last year, China is now the number one e-commerce market in the world. So how exactly have digital payments become so widespread?>> I'm Reuters' Grace Lee in Beijing.
Behind China's online payment boom are the country's two top tech firms, Alibaba and Tencent. Tencent, the company behind WeChat, is the country's biggest gaming and social media service, while Alibaba has an unmatched e-commerce network called Taobao. The two dominate the market here because outside services like YouTube, Facebook, and Twitter are all banned by the government.
And when they introduced online payment services to their already booming networks, it meant that most people in China had an online payment system already in their pockets.>> As a result, Western rivals have been left in the dust. Nearly two years on from its launch in China, Apple Pay has proved practically no match for the local titans.
Tencent and Alibaba together make up 90% of China's mobile payments market. Apple was also late to the game on QR codes, a hugely popular feature that's changing the way people in China spend money. Meanwhile, Alibaba's payment service, Alipay, has leapfrogged PayPal as the world's largest mobile payment platform.
Their business is largely focused on China. But they're setting their sights on becoming a global payment provider over the next decade.>> I think the reason Alipay is so successful is that it's not just a third-party payment tool or meant just for transferring money. Its services reach out to all aspects of life, like financial services, life services, and even administrative services.
So as long as you have your smartphone, you can literally go out without carrying your wallet.>> Although much of the Internet is shut out by China's famous great firewall, the local dotcom giants that have been allowed to thrive within it are flourishing. And as tech-savvy users become more accustomed to living their lives through a single platform, paper money is rapidly becoming a thing of the past.