More than two years after its official online launch, Huawei’s payment service has made a new advancement. Its payment institution, “Xunlian Zhifu”, has been renamed to “Huaban Payments” (literal translation: Petal Payments).
Notably, WeChat Pay and Alipay currently dominate over 90% of the domestic payment market. However, Huawei’s payment head once mentioned in an interview with the Securities Times·e Company reporter that Huawei does not consider WeChat Pay and Alipay as competitors. Both of them are Huawei’s partners. Huawei Payment’s main focus at present is on innovating user experience, positioning itself as an innovative all-scenario payment platform.
Huawei’s “Huaban Payments” is Here
Specifically, on October 13th, the People’s Bank of China updated its major changes to non-bank payment institutions and approved the name change of “Shenzhen Xunlian Zhifu Network Co., Ltd.” to “Huaban Payments (Shenzhen) Co., Ltd.”
Xunlian Zhifu was originally a payment institution under Huawei. Initially funded by ZTE Software Co., Ltd., it was established in June 2013. In 2014, it obtained the “Payment Business License” from the People’s Bank of China, allowing it to offer internet payment, mobile phone payment, and digital TV payment services, though it later voluntarily terminated its “digital TV payment” business.
In January 2018, there was a change in shareholders for Xunlian Zhifu. ZTE Software fully withdrew, making it a wholly-owned subsidiary of Shanghai Worrayo and a payment institution under Zhongtong Shares. By March 2021, Xunlian Zhifu became a Huawei subsidiary. Enterprise data from Qichacha APP shows that Huawei currently holds 100% of Xunlian Zhifu’s shares, with Ma Chuanyong serving as the General Manager.
It’s worth mentioning that this renaming was not without forethought. According to the National Intellectual Property Administration’s official website, Huawei applied for the Huaban Payments trademark in October 2020 and received approval for its registration in June 2022.
Not Competing with WeChat Pay or Alipay
Looking back at Huawei’s payment service development, Ma Chuanyong stated to Securities Times·e Company that Huawei’s payment services grew almost concurrently with the development of smartphones. Starting from 2011, Huawei began offering in-app payments, mainly to facilitate transactions for apps listed in Huawei’s app market.
In other words, Huawei’s payment service was primarily aimed at empowering the Huawei mobile ecosystem, aiming to provide a complete commercial payment solution for Huawei mobile users and partners. However, with the launch of the Huawei IoT operating system, HarmonyOS, in 2019, the mission of Huawei Payments evolved, taking on the responsibility of empowering the HarmonyOS ecosystem.
“The HarmonyOS ecosystem faces a multi-terminal, multi-industry scenario. In the future, it will not only appear on mobile phones, tablets, and cars but even on karaoke machines, large advertising screens, and other places. Huawei Payments is the underlying infrastructure of the HarmonyOS ecosystem, deeply integrating payment capabilities with the HarmonyOS system, allowing Huawei developers and partners to complete the commercial loop within the HarmonyOS ecosystem, and users can conveniently and securely make payments. Huawei Payments is not just mobile payment; it’s an innovative all-scenario payment platform,” said Ma Chuanyong. This differentiates Huawei Payments within the industry.
After internally clarifying this positioning, in March 2021, Huawei acquired 100% of the shares of Xunlian Zhifu, securing a mobile payment license. In September 2021, Huawei Payments was officially launched online. It operates through the Huawei Wallet as a management portal, providing individual users with balance payment, bank card payment, red packet, recharge, withdrawal, and other services. It also quickly integrates payment capabilities for enterprise users, offering financial settlement, auto-split accounts, and marketing empowerment. The latest public data shows that the monthly active users of Huawei Wallet have exceeded 140 million.
Again, it’s noteworthy to mention that WeChat Pay and Alipay currently dominate over 90% of the domestic payment market. However, Ma Chuanyong once said that Huawei doesn’t see WeChat Pay and Alipay as competitors; both are partners to Huawei. Huawei Payments is mainly focused on innovating user experience, positioning itself as an innovative all-scenario payment platform.
In November 2022, Huawei announced that Alipay has officially joined the HarmonyOS ecosystem. Huawei is currently exploring more possibilities for atomized services based on HarmonyOS with Alipay. Huawei claims that users will soon experience atomized service cards for Alipay’s life payment through smart search, directly completing online payments. In the future, they will also launch services such as medical insurance inquiries, provident fund inquiries, and proactive smart recommendation services based on smart location cards. In addition, users will enjoy Alipay’s in-car services in atomized card format, offering services like refueling, parking payment, express reminders, and other car-related services.
Regarding Huawei’s considerations for its future market share in the payment business, Ma Chuanyong said, “In the future, as new scenarios and markets expand and users prefer using Huawei Payments, our share will increase.” Regarding the profit model, Ma Chuanyong also once said that the profit model for payments is simple, and all companies’ profit models are based on transaction flow rates. Currently, Huawei places more importance on the added value brought by payments, such as Huawei’s game ecosystem, music ecosystem, and video ecosystem. With so many users using Huawei Payments, the value it brings is more meaningful to us.