As China’s growing mobile payment market continues to be dominated by giants Tencent and Alibaba, the two have taken their rivalry overseas in a bid to become the top payment method of choice for Chinese tourists abroad.

Tencent’s WeChat Pay and Alibaba’s Alipay control 94% of China’s mobile payment market as of the first quarter of 2017, with Alipay’s 54% beating WeChat Pay’s 40%. But Alipay’s lead has been rapidly eroding as WeChat Pay cuts into its market share: as recently as the third quarter of 2015, 71% of mobile purchases in China were Alipay-controlled.

Now, the international market is the next frontier for both companies as they compete to enlist retailers focused on the booming outbound Chinese tourist market. WeChat, which has offices in Italy and San Francisco, announced in February 2017 that it had inked a deal with mobile payment platform Citcon to make its payment services available in North America, while Citcon also announced a partnership with Alipay for a similar service in the same month. WeChat later announced in March that it is planning to open offices in the UK and another country in Europe, with a goal to encourage not only cross-border e-commerce in China, but also in-store adoption for Chinese tourists.

As North America is shaping up to be a key battleground, Alibaba’s Alipay management arm Ant Financial signed a deal with payment processing company First Data last month to implement Alipay in the region. This expanded the two firms’ October 2016 agreement to make Alipay available at selected high-end and specialty retailers in New York and California.

WeChat and the Alipay mobile app both promote a growing number of cashless lifestyle conveniences to complement their payment systems such as e-commerce, ride hailing, ticket booking, food orders, bill payment, investments, red envelopes, and more. Alipay is especially focused on travel, describing its mobile platform as a “global lifestyle superapp” with an its Overseas Travel Channel (支付宝境外游) that allows retailers abroad to offer in-app promotions to Chinese travelers. According to L2’s Cross-Border and Travel Retail Insight Report and Digital IQ Index: Luxury China, examples of brand boutiques that have offered Alipay promotions include Louis Vuitton’s 5th Avenue flagship in New York, an MCM boutique in Seoul, and SK-II concept stores in Hong Kong and Macau. Others such as Origins have offered promotions through duty-free shops such as DFS. A recent video by L2 explains in more detail how brands are using mobile payment platforms abroad:

WeChat and Alipay don’t just have one another to worry about, as other payment companies have their sights set on mobile as well. UnionPay, China’s main card payment method, launched a new QR code payment feature domestically in late May to compete with the mobile giants. With a presence at over 10 million merchants outside mainland China, UnionPay is also the dominant payment method for Chinese travelers abroad—meaning that the global contest for Chinese travelers’ mobile wallets may heat up even more in the future.

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