China’s Alibaba and Xiaomi Partnering on Wireless Payments for Wearables

The largest domestic brand of smartphone in China, Xiaomi partnered with Alipay a subsidiary of Alibaba and created wearables that are payment devices.

The partnership has the goal of creating wearable devices that link to the identity of the user so they are able to make payments with the wearables along with a number of other uses such as opening doors of hotel rooms or purchasing a cinema ticket.

Huami, a startup based in China, which is a maker of wristbands for Xiaomi, announced that the new device could connect to many services that were web-based and act as the identity card of the user.

When partnered together with app from a smartphone, users will not have to worry about entering passwords to make the payments using Alipay, when wearing their wristband.

Each time there is a payment made, the app for Alipay identities the wristband to make sure it is approved. The data for the payment is transmitted through Bluetooth and will be encrypted ensure its security, said the company.

If the owner loses the wristband, it could not be paired with any other smartphone until the owner of the wearable deactivates it. Therefore, other people are not able to make any payments from the account with someone else’s wristband.

However, if a wristband and smartphone are lost, whoever has both can easily make any payments since there will be no need for passwords.

Alipay spokesperson Jiang Long in a prepared statement said that the capabilities of payments and other financial transactions would add to the already growing popularity of the wearable devices.

The two companies announced this partnership following over six months of working together on the project. Xiaomi has previously set up a system of online payments. Last month, the smartphone maker announced its mobile wallet payment system that pays users interest on the money that is transferred into it.

In China, the most mature market for mobile payments, providers processed over 6 trillion yuan or $960 billion during 2014, which is five times the amount from the previous year.

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