Author: Paul Winslow, Marketing and Communications Manager, PaySec
Let’s take a moment to consider the potential size of the market – the population of China is approaching 1.4 billion people. That’s around 18.5% of the world’s population. With internet penetration now approaching 50% that means there are now 667.69 million Chinese people online.
This, combined with a simultaneous increase in relative wealth, means e-tailers now have direct access to millions of potential customers where previously they would have had to set up a standalone Chinese entity.
And it is not just the potential market size; it is the nature of that market. Put simply, the Chinese are crazy for shopping and crazy for eCommerce. And they’re only getting worse (or better from a merchant’s point of view):
eCommerce is becoming a way of life for the Chinese. Practicality, price comparison and better access to other markets have all played their part in its growth. And it’s not just within its own borders that the Chinese are looking to shop. More and more cross-border commerce is taking place:
There are three primary payment methods used for cross-border transactions: China UnionPay, Alipay and Tenpay. Alipay is owned by the Alibaba group and is the biggest e-wallet solution in China while Tenpay is its biggest competitor. Both offer access to significant market share.
There can be limits on the size of transactions and available currencies. China UnionPay is the only domestic bank card organisation in China with an estimated 3.5 billion cards issued. There are more CUP debit cards in circulation than Visa and MasterCard combined. WeChat Pay is the up-and-coming payment method. Already immense domestically, it’s also making inroads for consumers buying cross-border.