The rise of Chinese influence in aid to less developed countries challenges Western aid models at least to the extent that those models want to connect aid to human rights and to kinds of development other than economic development. Not all Western models of aid do make such ties, but China’s aid explicitly does not.
At least for the last two decades or so, Western models of aid have tended to emphasize that aid should be connected to other outcomes that Western societies approve of. Aid should be connected, for example, to increased democracy, to respect for the rights of women, and to equal rights for various ethnic groups. Countries that fail to make progress towards these goals should, in the eyes of many in the West, be denied aid on the grounds that we do not want to enable and even support governmental regimes whose policies are repugnant to us.
The rise of China challenges these assumptions because China is not interested in promoting any particular values. China wants its aid to A) help it economically and B) win it friends in the developing world. Therefore, China is happy to give aid to dictators and other non-democratic governments without trying to push those governments to enact any sorts of reforms. This is a major challenge to Western models of aid because it gives less developed countries options. They can reject the Western aid with its “strings” attached and take Chinese aid. This also challenges Western models of aid because it forces Western countries to decide if they really want to risk pushing countries closer to China by refusing to give them aid due to their lack of reforms.