Alibaba's Latest Payments Innovation: Selfie-Powered Transactions
As mobile payments become more a part of the business landscape, the question of how to make them safer is top of mind. Alibaba -- the vast Chinese ecommerce company that closed out 2014 with the biggest U.S.-based IPO to date -- has a solution.
This week, Alibaba founder Jack Ma spoke at the CeBit conference in Hanover, Germany and demonstrated a new service called "Smile to Pay" that would give consumers a password-free way to shop online. The service would allow users to make a purchase from their mobile phone, then require them to snap a selfie to authenticate the purchase using Alibaba's facial recognition technology.
"Today we’ll show you a new technology, how in the future people will buy things online,” said Ma of this latest innovation, which will first be rolled out in China.
Alibaba owns an online payment platform called Alipay, which has a complicated back story. It was launched in 2004 to be used for Taobao, an online marketplace comparable to eBay. In 2011, it was spun off into its own entity under the control of a company called ANT Financial (which in turn was founded by the Alibaba Group).
Ma still has a 46 percent stake in Alipay, which boasts more than 100 million mobile users (over 300 million users as of December '14) and has hosted over 2.78 billion transactions on the Alipay Wallet app.
Alipay is currently accepted by a number of Western-based retailers including Bloomingdale's, Macy's and Saks Fifth Avenue, thanks to a relationship with ecommerce platforms such as ShopRunner.
Nina Zipkin is a staff writer at Entrepreneur.com. She frequently covers leadership, media, tech, startups, culture and workplace trends.