According to data from data analysis and online tracking firm iResearch, the total transaction volume by independent mobile payments services from China increased by 707%, rising to $201.2 Billion (1219.74 Bn Yuan) in 2013. Its surprisingly high.
The independent services that iResearch refers to are all payment services. This excludes those services by China UnionPay and Conventional banks though. Payments also include p2p money transfers.
Independent Mobile Payments Market – China
- Credit Card Payoffs, online money transfers and other mobile payment applications are the major growth drivers however. Mobile shopping does not take pole position anymore according to the report.
- In 2013, 93.1% of payments were made through mobile payment apps or alternative services.
- There was a large decrease in payments through text messages in the last three years. The figure fell from 92.5% in 2010 to 6.1% in 2013.
- NFC is still having a hard time in China. Its share in payments fell from 2.6% in 2012 to 0.8%.
- It is estimated however, that with the adoption of near field payment solutions such as Alipay On-Site, with QR Code and acoustic payment capability will drive NFC payments in 2014.
One of the major players in the Chinese payments space is Alibaba. Its subsidiary Alipay, accounted for 75 percent of the country's mobile payment market as of June. Alibaba Holding Group Ltd is a network of e-commerce B2B businesses constituting an online marketplace, shopping search engine, retail and payment platforms and more. It is led by chairman Jack Ma, whose net worth is $3.6 Bn.
If Alibaba is the Amazon and ebay of China (now global) then Alipay is the paypal. It is an online payment services provider founded by the Alibaba group in 2004. The system allows individuals and businesses to make payments online in a secure manner. Alipay’s users are primarily buyers and sellers engaging in e-commerce transactions. Alipay has partnered with some leading Chinese banks including Bank of China, China Construction Bank, Agricultural Bank of China, the Industrial and Commercial Bank of China and Visa.
Alipay provides solutions for Taobao and Alibaba.com along with over 500,000 external merchants for virtual gaming, online retail, digital communications, airticketing, commercial services and utilities fee payment transactions.