China - Trey Ratcliff

Xioami Steps Into Mobile Payments Fray With Official Mi Pay Announcement

August 18, 2024         By: Steven Anderson

From Apple Pay to Samsung Pay and beyond, mobile device makers have largely embraced the addition of mobile payment systems to their current product lines. One more such maker, Xiaomi, is joining in the hunt for a slice of that growing mobile payments market with the announcement of mostly-titular Mi Pay.

Xiaomi CEO Lei Jun made the official announcement, noting that Mi Pay is much like Apple Pay, given that it’s a near field communications (NFC) based service, with several banks currently supporting it including China Construction Bank, China Merchants Bank, Ping An Bank and several others. Plus, starting next month, the list will climb considerably as several other banks get in on the action including the Industrial and Commercial Bank, China Everbright Bank, and the Guangdong Development Bank, among others.

Interestingly, right now, not many Xiaomi devices actually seem to support NFC capability, with the Mi 5 smartphone chief among them. Given that it recently took a price cut, at last report, Mi Pay could be what Xiaomi needs to get more users in play.

There’s one big problem with this concept, however, and that’s Alibaba’s mobile payment system Alipay. It’s been in the market for quite some time now, and has probably already taken a big bite out of Xiaomi’s potential market. Xiaomi would have to have a very clear competitive advantage and “one more NFC-based mobile payment system” really doesn’t qualify.

Indeed, the initial reaction doesn’t seem all that great, with some considering it untrustworthy, and others taking exception to the naming conventions involved. That’s going to take a lot of work to overcome, not to mention what it will take to haul users out of the Alipay camp that’s been up and running for some time.

Still, if it can bring out an advantage, it can work the convenience angle as well to get the Xiaomi users out of Alipay’s camp and back into its own. It’s going to take something very big to make that happen, and right now, it’s not clear what that is.