Thanks to the increasingly rapid advancement of e-commerce and Internet technology, third party e-payment platform [hereinafter e-payment platform (EPP)] indicates a vigorous development trend in China. According to the 2008–2009 Annual Report on China’s Third–Party Electronic Payment Market, China’s third party EPP market had grown rapidly in 2008, with payment transaction value exceeding RMB 2,500 billion yuan, and it is expected that the 100 %-plus growth can be maintained in 2009.¹

In general, third party EPP is an independent entity with certain strength and credit protection, it signs contracts with major banks and then provides services of online payment that connects with the banks’ payment and clearing systems. It provides direct money transfer services for Internet transactions and works as a bridge between business, customers, and banks. This Web-based new technology has great potential; it offers consumers and businesses great convenience, choices, security, and substantial cost savings. Since its birth in 1999, it has been flourished and up to now, there are more than 50 enterprises providing third party EPP services in China.

According to a report released by Analysis International, in the third quarter of 2008, the market share of those enterprises are as follows: Alipay placed the first with 58.1 % market share, Tenpay was the second with 17.3 % market share, while Chinapay, 99bill, and Yeepay each held 11, 4.4, and 0.9 % market share.²

Alipay, the largest third party EPP enterprise in China, first appeared as a site www.​alipay.​com on www.​taobao.​com in October 2003, and soon became the prevailing payment method of the Taobao registers. After gaining much popularity, it achieved an independent operation and started to show up as the newly Alipay corporation in 2004.³ Since then, it provided e-payment services to many entities other than Taobao and expanded its business to B2C and C2C market. In the 4th quarter of 2008, its market share expanded to 59 %, while its registers surpassed 100 million, making it the second largest third party EPP in the world, only inferior to Paypal of America (see Footnote 1).

The basic pattern of an online shopping through Alipay is as follows: a customer pays Alipay first and then Alipay informs the business that it has received the payment so that the business can safely send out the goods. When the customer receives the goods, he/she will inform Alipay to transfer the payment to the business, and then a deal is done (see Footnote 3). During this process, Alipay works as an intermediate and separates money paying and collecting from each other. Thus, it becomes a third party guarantee which gives its registers much sense of security when dealing with it. To a large extent, Alipay solves the problems of credit and safety that hinder the development of e-business for years.