SOUTH KOREA. Lotte Duty Free has begun using the Huabei online payment service – provided by Alibaba subsidiary Ant Group – in preparation for the return of Chinese tourists when COVID-19 travel restrictions ease. The retailer is the first to employ Huabei in Korea’s highly competitive ecommerce market.
The Huabei service welcomed its first transactions in 2015 and has grown in popularity with younger Chinese consumers; half of the 400 million Chinese users of the payment service registered at the end of 2019 are under the age of 30.
Huabei is based on a micro-loan system, opening with a small amount of credit and allowing for limit increases, as users build up a repayment record. Consumers can purchase items using the loan service within the limit, with 12 transactions per year allowed.
Lotte said that Huabei is expected to help sales to young Chinese consumers, as approximately 80% of sales to Chinese shoppers on Lotte Duty Free Online are to those aged in their 20s and 30s.
As part of the launch, the retailer will hold a Red Envelope Hongbao event until 10 November, with a plan to provide up to US$120 in points that can be used at Lotte Duty Free Online for each purchase on transactions higher than US$70.
