Uber has announced that it is partnering with Alipay to gain a foothold in the lucrative Chinese market. Under the new deal, Chinese users will be able to use their Alipay accounts to settle the fare of their Uber taxi rides anywhere in the world.

The new partnership will allow Alipay's 450 million users to pay for their taxi ride in Yuan irrespective of the local currency of the country they are in. Uber already had a pact with Alipay, which was applicable in Mainland China, Taiwan, Macau and Hong Kong. However, once outside of China, users were required to pay in US dollars. The new integration will do away with currency conversion requirement.

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China is one of the biggest markets for Uber outside of the US. However, with the emergence of home-grown Didi Kuaidi, the taxi sharing company is facing stiff competition.

Alibaba has also invested in Lyft and Didi Kuaidi and is looking to become a global payment processing service provider. It has also investments in Paytm, a payment processor in India.

Uber China's senior vice president Zhen Liu said, "We believe we're just getting started.This partnership is critical to our continued China strategy."

Both parties have kept the financial details of their partnership confidential.

TagsDidi Chuxing, Didi Kuaidi, Uber, Alipay, Ant Financials, Alibaba, Paytm, lyft