The promotion is to change cardholder habits from swiping cards to paying with phones.
China’s online third-party payment market is worth USD 874.37 billion (CNY 5.4 trillion) and it is expected to double over the next four years, according to a recent report by iResearch.
In 2013, the transactions of almost 250 certified third-party payment service providers accounted for 1.72 trillion yuan. Growth in the third-party payment market lies in investments because money market funds distributed online are becoming increasingly popular among investors.
According to Barclays Research, these funds account for less than 1% of more than CNY 100 trillion held in bank deposits at end-2013, but their assets have swelled by an average of CNY 93 billion each month from July 2013 to January 2014.
China’s central bank introduced rules to guide development of the third-party payment market in March 2014. It suspended digital credit card services and payment by scanning a barcode or quick-respond code with a smartphone to address concerns about protecting cardholders’ payment securities.
According to Zhang Meng, an analyst with Analysis International, mobile payment will also expand at a fast pace in the next two years. Its estimated the value of transactions completed via mobile payment will reach CNY 4.1 trillion by 2016, some four times of that in 2013.
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