Cashless onboard payments with South East Asian cruise lines

20 February 2018



Cruise lines operating in South East Asia are increasingly integrating apps like WeChat and Alipay into their on-board payment models. Abi Millar talks to Simon Ho, vice-president of guest commerce and experience at Dream Cruises, about why so many cruise lines are moving towards a mobile-first payment infrastructure and whether it’s a sign of things to come.


Cruise lines operating in South East Asia are increasingly integrating apps like WeChat and Alipay into their on-board payment models. Abi Millar talks to Simon Ho, vice-president of guest commerce and experience at Dream Cruises, about why so many cruise lines are moving towards a mobile-first payment infrastructure and whether it’s a sign of things to come.


China is fast becoming a cashless society. Over the past few years, its traditional banking system has been disrupted by mobile apps like Alipay and WeChat, which allow people to pay for nearly all their day-to-day expenses by scanning a code on their phones.

Although similar digital platforms, such as Apple Pay, are making waves elsewhere, in China they’re ubiquitous. The US’s burgeoning mobile payment sector is around 90 times smaller than China’s, which currently stands at $5.5 trillion. More than eight million brick-and-mortar shops now accept Alipay, a service with 520 million users globally.

Unsurprisingly, a number of cruise lines operating in South East Asia are taking note. Several operators have begun to integrate these apps into their payment models, with a view to bringing the guest experience closer to how they live their lives onshore.

“One of the key pain points for guests travelling internationally is the access to funds,” says Simon Ho, vice-president of guest commerce and experience at Dream Cruises. “By partnering with Alipay, we bring a mobile payment solution that our guests, particularly mainland Chinese, are already very comfortable using.”

Increasing popularity at sea

Genting Cruise Lines, Dream Cruises’ parent company, first partnered with Alipay in 2015. That year, Star Cruises, another Genting brand, became the first line to accept Alipay spot payments on board. More recently, the company extended this partnership to its new luxury brand, Dream Cruises, beginning with Genting Dream in 2016 and moving on to World Dream the following year.

“We have launched the full suite of mobile payment options at sea, allowing guests [to have] the options of spot payment, self-checkout and auto-debit with Alipay,” explains Ho. “They can also use AlipayHK, the newly launched Hong Kong version of Alipay, which supports transactions in HKD for Hong Kong.”

Another ship to welcome Alipay is the Norwegian Joy – a Norwegian Cruise Lines’ vessel that was the first to be stationed in China. It has cleverly been designed with this market in mind and claims to offer a ‘fully immersive Chinese cruise holiday’.

From a payments technology standpoint, these guests leapfrogged credit cards and went straight to mobile-first payments.

Shortly before the ship’s maiden voyage in June 2017, the company announced it would partner with Alibaba Group, the commerce company behind Alipay, in order to glean insights into the Chinese consumer base. The payment solution was later debuted on a special preview cruise before being rolled out to all guests.

“When designing Norwegian Joy, our goal was to construct a ship that would deliver a first class at-sea experience, while making Chinese guests still feel at home,” said David Herrera, former president of Norwegian Cruise Line Holdings China operations, in a press release. The new senior vice-president of strategy and corporate development added, “Providing the Alipay payment solution to our guests allows [them] to make purchases with the most-used payment system in China, in the same way that they use it on land.”

Meanwhile, Costa Cruises, which has four ships based in Asia, has announced a collaboration with WeChat, a social platform that has been dubbed China’s ‘app for everything’ owing to its wide range of functionalities. After launching a series of mini programmes last year, the ships now offer a ‘one-stop digital solution’ with the platform, which enables guests to make payments across many different scenarios.

SkySea Cruise Line and Princess Cruises also use Alipay, but the most definitive embrace of payment apps comes from MSC Cruises, the world’s largest privately owned cruise line. Having already launched the payment service on the MSC Lirica – which serves the Chinese homeport market – the company recently announced it would roll out Alipay across its fleet worldwide. This service will be extended to all 14 ships by March 2018.

This groundbreaking decision could be read one of two ways: either MSC is expecting to see increased use of Alipay internationally or it is hoping to attract more outbound Chinese cruisers. Forecasts suggest that, by 2030, there will be between seven and ten million outbound Chinese passengers, putting China on course to overtake the US in terms of market size.

In a statement, MSC Cruises CEO Gianni Onorato said, “Chinese guests will be an important driver of the cruise industry and are highly valued by MSC Cruises... Introducing Alipay to MSC Cruises’ entire fleet as a payment option is a testament to our long-term commitment to Chinese guests and [the] market.”

So what does this shift in the payments model mean for cruise ships in China? And might MSC Cruises’ recent announcement set the tone for what’s to come?

Offering a better service

If cruise ships are going to continue to attract passengers, Ho believes that they need to take their cues from what’s happening on land. “Cruise ships must keep pace with the broader payments ecosystem on shore. This means keeping up with all the latest developments in payment methods and even cryptocurrencies,” he explains.

We are already hearing talk of the ways that blockchain-powered platforms could change the travel industry. Despite fears that the bitcoin bubble was bursting, January 2018 saw 600 cryptocurrency enthusiasts set sail from Singapore on a blockchain cruise.

With regard to payment apps, the scramble to deploy the infrastructure reflects a strong desire for relevance. Over the past few years, the Chinese cruise industry has grown dramatically, climbing 70% annually between 2013 and 2016, according to Goldman Sachs. The market has seen a rush of ships deployed to China, alongside a number of purpose-built ships for the Chinese market, and entirely new cruise lines like Dream.

However, it seems that passenger numbers are now falling, with most operators in this market cutting capacity. Around 2.4 million Chinese passengers are expected to take a cruise this year, compared with 2.8 million in 2017.

Long-term forecasts are more optimistic, with China’s Ministry of Transport expecting to see 4.5 million cruisers in 2020. The short-term market outlook tells a different story and is undeniably concerning. Existing ships are under pressure, so how can they adapt to Chinese preferences and steal a march on the competition?

According to Ho, the likes of Alipay are just another convenience afforded to the guests.

“World Dream, our ship currently serving the Pearl River Delta market, has predominantly mainland Chinese guests,” he says. “From a payments technology standpoint, these guests leapfrogged credit cards and went straight to mobile-first payments.”

Ho adds that these passengers love the service. Some are opting for a ‘card-binding’ approach in which on-board expenses are charged to their Alipay account automatically, with the balance settled on a nightly basis. Others are using a ‘pay-now’ model, where they can settle the bill anywhere in the ship at any time.

We have launched the full suite of mobile payment options at sea, allowing guests [to have] the options of spot payment, self-checkout and auto-debit with Alipay.

“It’s an inconvenience that we’ve removed, so they can focus on what’s most important – quality time with their loved ones on a remarkable cruise vacation,” he remarks.

The downsides

Some commentators believe that there may be a ‘shadow side’ to payment apps. China recently tightened the regulations in this area, imposing a series of curbs that will hurt payment companies’ future expansions. What’s more, the debate surrounding data collection and privacy is beginning to ramp up.

As a recent article in the technology magazine Wired pointed out, an Alibaba subsidiary company, Ant Financial, has developed a platform called Zhima Credit (also known as Sesame Credit).

If a person opts in, the system uses their Alipay data to determine a credit score. Although Ant Financial has said that the platform is “independent of any government-initiated social credit system”, it has also stated that it is looking “to help build a social integrity system”. Through collaborating with various corporations, which reward people with good credit scores, Zhima may contribute to what the Wired article calls a ‘vast new experiment in social ranking’.

Of course, cruise lines endeavour to follow their customers’ preferences and will arguably have little stake in this debate. All Ho will say is that the app is not linked to credit rating services.

What does seem clear is that payment apps, despite the challenges ahead, are beginning to spread overseas. Alipay is already beginning to make inroads in the US, with an aim to extend payment services to the four million Chinese nationals who visit the US every year. Its parent company, Ant Financial, has also inked deals in a number of Asian countries, where digital banking is just getting off the ground.

Whether or not the service gains traction with Western cruisers, it will likely prove imperative for attracting custom from China. Chinese tourists shopping for a cruise in the Mediterranean would, after all, be more inclined to pick a cruise line that lets them pay in the same manner as they do at home.

From the cruise industry’s perspective, this means gaining a foothold in what is still a largely untapped market. Just 0.2% of the Chinese population have cruised, compared with 3.5% in the US.

Commenting on MSC’s global Alipay roll-out, Su Qiang, vice-president of Ant Financial, said in a statement, “We hope that Alipay, carried by MSC Cruises ships, will better serve Chinese tourists on their global cruises, while allowing foreign tourists to experience Alipay, [which] is secure, efficient and convenient. This is the mission and vision of Alipay expanding overseas.”

The World Dream accepts mobile payment systems on board.


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