Overseas shopping: get tax rebate through Alipay

Brief: On July 14, Alipay announced its strategic cooperation with one of the world's largest tax refund organizations Global Blue, the two jointly offering Alipay's overseas tax reimbursement service. From that day on, Chinese tourists shopping in Europe and other places can handle relevant tax reimbursement on Alipay, and the reimbursed amount can reach the user's account in as fast as 10 work days.
Statistics show that in 2013, China's outbound tourists reached 98.18 million, up 18 percent over the previous year, and the total consumption amounted to USD 128.7 billion, making China the biggest outbound tourism consumer in the world. According to other statistics, for either a lack of knowledge about tax rebate policy or the unbearable complicated formalities, about one third of Chinese tourists in Europe didn't claim tax rebates, with the unclaimed rebate amounting to 1 billion yuan last year. Now Alipay can be used to claim tax rebates. After filling out proper paperwork, the tax rebates will be automatically converted into RMB Yuan and transferred into the user's Alipay account in as fast as ten days. Alipay has once again expanded its mobile payment services into a mass market.
 
Tao Fang is a lawyer in Beijing. She travels abroad more than once every year. She said that in Europe, almost all employees at the tax reimbursement counters know two expressions in Chinese: "cash", and "queue up".
 
These two expressions are a pain in Chinese tourists' heart. "In order to encourage foreign tourists to shop, most countries have their own tax reimbursement policy. When you shop for more than a certain amount in a certain store, the store will give you a tax refund receipt; get the receipt stamped in the airport customs and you can claim the refund when you enter the border. Last month, I bought a LV bag in Italy for EUR 2840. I got a 14 percent tax refund, almost EUR 400", said Tao Fang, "But to get the EUR 400, you need to get to the airport at least 2 hours earlier, because Chinese don't trust in credit card. Everyone demands cash refund, so there is always a long queue in front of the tax refund window".
 
Now, there is one more way to get your tax reimbursed. On July 14, Alipay announced its strategic cooperation with one of the world's largest tax refund organizations Global Blue, the two jointly offering Alipay's overseas tax reimbursement service. From that day on, Chinese tourists shopping in Europe and other places can handle relevant tax reimbursement on Alipay, and the reimbursed amount can reach the user's account in as fast as 10 work days.
 
Open to thousands of merchants in five countries
According to Alipay, consumers only need to fill their Alipay-linked mobile phone number, passport number, and Chinese name in Pinyin on a tax refund form that has the "Alipay" option, get the form stamped in customs before exit, and deliver the form into designated mailbox in the airport, and then the users only need to wait for the money to reach their accounts. In as fast as 10 work days, the refund will automatically be converted into RMB and transferred to the consumer's Alipay accounts, with notification of the transfer.
 
Compared to conventional cash refund and credit card refund, Alipay refund eliminates the queuing up process in front of the tax refund window; also, users don't have to pay the cash withdrawal fee, and the process is much simpler and more efficient than that of credit card refund, almost 3 times faster. Peng Yijie, vice president of Alibaba Microfinance's International Business Division, said that this is possible because Alipay can pay the money to the refunding users in advance based on its trust in the users, with data of the users in Alipay's possession. She also said that Alibaba is currently exploring solutions that can handle tax refund at the time of shopping.
 
David Baxby, CEO of Alipay's partner Global Blue, said that Global Blue completed 26 million tax refund transactions in 2013; it has more than 270,000 department stores and hotel partners in 43 countries. At present, Alipay's tax reimbursement supports tens of thousands of Global Blue's tax refund partners in France, UK, Germany, Italy, and Korea, including UK's Harrods, Germany's KaDeWe, and Italy's La Rinascente. This summer, Alipay's tax refund service will also open in Switzerland, Holland, and Spain.
 
In fact, in as early as October last year, Alipay has launched its overseas tax refund pilot in Korea. According to Alipay, over the last six months, more than 100,000 tourists traveling to Korea has used the service to handle shopping tax refund, and tax refund has thus become one of Alipay's most popular overseas applications.
 
As for charge, Peng Yijie said that the service is currently free of charge for all users. "For us, the important thing is to let more people know about the service and spread it. Alipay hopes to help make people's life more convenient and beautiful".
 
More diversified services in the future
Besides its convenience, Alipay is also striving to make its services more diversified. Alipay supports the cross-border handling of tax refund services in Europe. Consumers to shop in France, Germany, UK, and Italy can handle the refunding procedure in the departing airports in France, Germany, Italy, Holland, Spain, UK, and Portugal, whereas conventionally cross-border tax refunds can only be done via credit cards.
 
Besides, Alipay has also introduced mobile application service for overseas tax refunds. By adding the "Alipay Global Tax Refund" service window to Alipay Wallet, a user can view the status of refunds and tax refund tips for different countries, helping users to understand Europe's tax refund in real time.
 
Peng Yijie also said that Alipay is also considering appointing Chinese-speaking personnel in major European airports, to provide tax refund guidance to Chinese tourists. "For many tourists it is their first experience with tax refund. They need guidance. The problem is how to get into the airport", because all tax refund counters are beyond the border.
 
Who would get up early in the morning if there is no benefit in it? In the view of industrial insiders, the reason why Alipay is so vigorously promoting its free tax refund service is to serve its global strategy, e.g., to enter the foreign O2O market through the tax refund service. The shopping tax refund service can help to cultivate users' habit in using Alipay products abroad, and it can also help Alipay to reach overseas merchants rapidly through its partners. Peng Yijie also said frankly that the most riveting thing for foreign brands is China's consumption market behind Alipay. "Many merchants are already discussing with us about the possibility of adding brand promotion and marketing events to tax refund notification and other services, as measures to explore the market". As a matter of fact, Alipay is not the only third-party payment service provider to target the oversea market. Tenpay, a subsidiary of Tencent, had also announced cooperation with some duty-free stores in Korea, basically achieving online payment in these stores; the thing to note is that Tenpay is closely linked to WeChat, who has more than 600 million users.
Source:China Economic Net

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