Payments companies look into China with caution
China appears to be opening up to the idea of a wider range of payments options. Before overseas companies look to dive in, they need to make sure they are keeping on the right side of the regulator.
China is seeing a sea-change in how its consumers are making purchases. At the beginning of the year, Alipay reported that 82% of payments made on its channel in 2017 had been made using a mobile device. The company has 520 million users in the country, with some consumers spending up to $50,000 a year through the service.
Meanwhile, competitor WePay is hosted within the Tencent-owned WeChat instant messaging service, which has more than a billion users. Around 80% of these are stated to have used the app to make a payment.
Aware of the dominance of these two companies, the People’s Bank of China (PBoC) has announced it will allow foreign payments companies to move into the country.
Lu Zurawski, consumer payments practice lead EMEA at ACI, says: “Payment volumes have become so large the government and
the PBoC have moved to reign in volumes over third-party, non-bank networks. Some estimates suggest that more than $60 billion of funds are floating within mobile wallets outside traditional payments networks.