Samsung, Apple, Ali, and UnionPay... Naver Pay Truly Committed to Offline

Naver Pay Partners with Alipay and UnionPay
First in Korea to Collaborate with 2 of China's Top 3 Companies
Enables On-Site Payments Across China... Re-Targeting Japan
Growth Potential Exceeds Online... Focus on Offline Too

South Korea's largest simple payment service, Naver Pay, is focusing on expanding its offline territory. In particular, it is rapidly increasing the regions where overseas payments are possible. Judging that the growth of the domestic online market has slowed, it appears to be concentrating on the offline market, which still has ample growth potential.

According to the industry on the 20th, Naver Pay started its on-site payment service at all Alipay-affiliated stores across China from the previous day. This came about two weeks after launching QR-based on-site payments in China and Japan in partnership with UnionPay on the 7th. Considering the influx of Asian tourists for the 19th Hangzhou Asian Games opening on the 23rd, it is interpreted as an active expansion of on-site payments.

With this, Naver Pay has become the only domestic simple payment service provider to partner with two of the three major simple payment companies in China: Alipay, UnionPay, and WeChat Pay. Notably, Naver Pay is the first to start payment linkage with UnionPay. Since the number of Alipay and UnionPay affiliated stores in China reaches 59 million (including duplicates), it means that offline payments with Naver Pay are virtually possible in most regions within China.

Naver Pay is putting effort into expanding in China even at the cost of breaking ties with its former 'blood alliance' Line Pay. Through its previous partnership with Line Pay, Naver Pay only provided payment services in Japan, but it ended payment linkage with Line Pay earlier this month. However, this does not mean it has given up on the Japanese payment market. On-site payments with Naver Pay are possible at UnionPay-affiliated stores in Japan. Within this year, Naver Pay plans to support payments at Alipay Plus (Alipay's overseas payment service brand) affiliated stores in Japan as well.

It is also focusing on expanding domestic offline payments. In March, Naver Pay partnered with Samsung Electronics to enable payments not only via QR codes but also through the Magnetic Secure Transmission (MST) method, similar to Samsung Pay. Considering that the credit card most registered on another offline contactless payment service, Apple Pay, is the Naver Hyundai Card, it can be seen that indirect collaboration with Apple has also been achieved.

The reason for focusing on offline payments is growth. As of the second quarter of this year, the total payment amount in Naver's fintech sector, including pay services and digital finance, was 14.6 trillion KRW, a 21.2% increase compared to the same period last year. Among this, 6.3 trillion KRW was external payments such as overseas payments and offline payments made through Naver Pay. This increased by 40.5% compared to the same period last year, nearly double the overall growth rate. Among these, the growth in offline payments is overwhelming. As of the second quarter of this year, it reached 1.4 trillion KRW, doubling compared to the second quarter of last year.

An industry insider in the simple payment sector said, "Although the online payment market is also growing, compared to that, the offline payment market is almost a 'blue ocean.' Going forward, big tech companies including Naver will pay more attention to the offline market."

This content was produced with the assistance of AI translation services.