Tencent starts second payment app on mobile service

Tencent Holdings Ltd, China's largest publicly traded Internet company by market capitalization has integrated a payment function into its mobile QQ, a dominant messaging application.

Tencent said in a news release on Friday that users of mobile QQ are able to use the app as an "e-wallet" that can connect with their debit cards and their accounts on Tenpay, the e-payment arm of Tencent, to make online purchases.

Apart from allowing people to pay through mobile QQ, Tencent will also invite some of its business partners, such as Dianping.com, a group-buying site in which it has invested, to use the platform so that people will be able to directly purchase services such as restaurant-booking and taxi-booking.

The move marks a major step for Tencent toward expansion of its market share in mobile payment in China. Mobile QQ had monthly active accounts of 808 million as of the end of 2013.

Alipay, the e-payment affiliate of Alibaba Group Holding Ltd, enjoys a leading position in the sector, but Tencent has been rapidly closing the gap with the help of its popular mobile chatting app WeChat, which has had payment functions since last August.

The move gives Tencent a second 'killer' machine in the mobile Internet sector because mobile QQ offers exactly the same services as WeChat. The only difference is that the number of users of mobile QQ is more than twice that of WeChat.

Pony Ma, chief executive officer of Tencent, said WeChat and Mobile QQ come hand-in-hand in terms of pushing the company's mobile strategy forward. "WeChat has already made some achievements in mobile payment. Mobile QQ, which is the largest social networking platform of Tencent, is expected to make a breakthrough in terms of building up a business model linking online payment and offline services," he said.

Tencent said it had successfully migrated its flagship QQ service from a primarily PC experience to one that is a primarily smartphone experience.