American Express is making a significant move in the expansion of its digital wallet, Serve to international markets today. The credit card company is announcing the first global partnership for Serve with Lianlian Group, of of China’s leading mobile payments providers. Additionally, AmEx has also made an equity investment of $125 million in LianLian Pay.
For background, Serve integrates a variety of payment options into a single account that can be funded from a bank account, debit, credit or charge card. AmEx has landed a number of lucrative carrier partner deals for Serve in the U.S. but this is the first step towards expanding Serve’s technology into one of the fastest growing consumer markets in the world.
Amex has entered into an operating agreement with Lianlian Group which will allow Lianlian to license and use Serve in products and services it develops for its consumer and business customers in China. The Serve platform will help power a new Lianlian Group digital wallet that consumers can use to top up mobile phone minutes, pay bills and purchase products or services online.
Founded in 2004, Lianlian Group has served approximately 300 million mobile phone accounts. It operates a network of over 300,000 small business agents across China where customers can buy additional top up minutes on their mobile phones. A portion of that network also allows customers to purchase airline tickets, video gaming credits and utility bills.
Group President for Enterprise Growth for American Express Dan Schulman tells us in an interview that American Express has come to realize that in a lot of fast growing economies internationally, people move money in different ways and in order to enter these markets, the company has to think beyond just plastic cards and checks, and consider moving straight to mobile platforms.
With the Lianlian Group, AmEx gets access to a company that has partnered with 3 of the largest carriers in China, and served one-third of all Chinese mobile users through payments network infrastructure, he explains. So a Chinese consumer who was paying cash to get minutes can now load the Serve-powered Lianlian digital wallet and have the choice of digital commerce, paying bills via their mobile wallet, send peer-to-peer payments, buying more minutes and ringtones and more, says Schulman.
AmEx is generally predicting China to be a huge market for its mobile and digital payments products and is planning to open a new American Express’ Enterprise Growth Group office in Hangzhou, China. The China-based team will provide technical and consulting support to Lianlian Group on the Serve partnership, and the new outpost will be headed by Matthew Lee, President, Enterprise Growth, American Express, China.
With the mobile penetration in China, it’s no surprise that AmEx chose the market as its first global opportunity to expand Serve. AliPay is also playing in the space.
Another area where we’ll see Serve expand is on data. As Harshul Sanghi, American Express’ VP of Enterprise Growth Group, told us recently, the personalized experience is going to be key in providing the digital wallet that consumers flock to. Intent data, structured data and unstructured data will all play a part of delivering a personalized payments experience for Serve.
In terms of financial companies, American Express has been at the forefront of trying to expand their mobile and digital offerings beyond the credit card business. Besides carrier partnerships for Serve, AmEx has announced a number of recent partnerships in the payments space include Foursquare, Facebook and even Zynga for personalized deals. The company has also been acquiring payments technologies and will be doing more investing in the space with a new $100 million fund.