Smartpay shares jump 35% on deal to offer Alipay via eftpos terminals in NZ, Australia
By Sophie Boot
March 13 (BusinessDesk) - Smartpay Holdings shares jumped 35 percent after signing a deal with Alibaba's Alipay, meaning its approximately 25,000 merchants in Australia and New Zealand will be able to offer the payment platform on their card terminals, with a pilot launching in New Zealand next month.
The listed payment terminal supplier said it will earn a share of total transaction value from Alipay mobile wallet users. Alipay and fellow mobile payment platform WeChat, owned by Tencent, are hugely popular in China, surpassing card use for payments. Alipay was launched in New Zealand late last year via a partnership agreement with Christchurch Airport, with that project predominately in the South Island, though Wellington's Weta Studio Tours has also signed on as an Alipay merchant through the project.
The shares climbed 6 cents to 22 cents, having dropped 12 percent in the past year.
Smartpay says the deal makes it the only acquirer in both NZ and Australia to provide an integrated terminal offering, as payments will be processed on the same terminal as eftpos and credit card payments. Participating merchants will be able to generate a transaction-specific QR code via the terminal for customers to scan, following a software update. A pilot in New Zealand will launch early next month, and an Australian pilot will follow, it said.
The company said the deal will let it access the valuable Chinese tourist market, which is forecasted to spend $11 billion in Australia and NZ in the current year.
"Offering their preferred means of payment will also suit international Chinese students who make up the highest proportion of international students in both countries," the company said. "Smartpay recognises that as well as a payment option, Alipay’s power lies in its ability to influence its over 520 million registered users. Smartpay is actively engaged with marketing partners to provide solutions to merchants to drive targeted marketing campaigns directly to Alipay users before and during their visits."
George Lawson, Alipay's country manager for Australia and New Zealand, said the payment platform is used by thousands of Chinese students and migrants, which are "very lucrative markets that are rapidly expanding."
In November, Smartpay reported that it made "significant progress" in the first half of the financial year, with net profit rising to $900,000 in the six months ended Sept. 30 from $500,000 a year earlier. The company received a takeover proposal from Sydney-based investment firm Pemba Capital Partners in August 2017 but Pemba decided not to proceed in December.