Following Alibaba's 25 billion dollar New York IPO in September, founder and board chairman of Alibaba Jack Ma told state media that Alipay will also go public someday, hopefully on the A-share market.

To that end, Alipay has started working with hospitals, stores and supermarkets, offering doctors appointments and payment services.

In Beijing, supermarkets such as Wu-Mart and Merry Mart are offering 10 percent discounts to encourage customers to pay their bills with their mobiles through Alipay.

Chen said Alipay, usually engaged in micropayment, has had to expand their community services with the "online to offline", O2O, and provide convenience to compete with UnionPay.

"With no more card swiping and signature needed, I'd rather use Alipay for convenience," said Cao Peng, a customer who paid his bill at a Merry Mart outlet in Beijing, adding that all he needed to do was to scan the bill code to make the payment with his smartphone.