Mobile Payments in China is expected to witness three-fold growth by 2023
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Low credit card usage, and increasing popularity of eCommerce coupled with a growing middle class in China have accelerated the growth of mobile payments in the country. China has also seen an increase in cross-border payment transactions, primarily due to growth in sectors such as eCommerce, travel and overseas education. Frost & Sullivan recently reportedthat nearly 65% of Chinese tourists have used mobile payments abroad, approximately six times higher than the average non-Chinese traveler.
“In China, eCommerce is a powerful incentive for users to purchase smartphones that enable mobile payment features. The social aspect that mobile payments brings can serve as an integral step in building trust and learning about digital services, especially in rural communities,” said Ms Mei Lee Quah, Industry Principal Analyst, Information & Communication Technologies (ICT) Practice, Digital Transformation at Frost & Sullivan.
The market of mobile payments services in China is expected to grow at a compound annual growth rate (CAGR) of 21.8% from 2017 to 2023, growing three-fold from US$29.93 trillion to US$96.73 trillion. The total number of active mobile payment customers is expected to reach 956 million by 2023 from 562 million in 2017 which will attract additional investments from mobile payments market participants.
Frost & Sullivan’s recently published report, Chinese Mobile Payments Services Market, Forecast to 2023, highlights the growth opportunities presented in the market, namely:
- Rural region penetration
- Addressing the elderly market
The report also offers detailed analysis of the mobile payment market in China with a focus on key market players such as AliPay and WeChat Pay, and their business and revenue models. The Chinese market for mobile payment offers not only market opportunities for solution providers intending to operate within the domestic market but also learning points for global mobile payment solution providers.
Frost & Sullivan predicts that China will continue to be a major player in the global mobile payment services market and service providers in the country will continue to focus on improving and enhancing security on mobile payment platforms.
Questions & Answers
Q.What factors are primarily driving the increase in mobile payments in China?
What factors are primarily driving the increase in mobile payments in China?
The growth is accelerated by low credit card usage, increasing popularity of eCommerce, and a growing middle class. Also, a rise in cross-border payment transactions from eCommerce, travel, and overseas education contributes to this trend.
Q.What is the expected growth in the number of active mobile payment customers in China by 2023?
What is the expected growth in the number of active mobile payment customers in China by 2023?
The number of active mobile payment customers is expected to reach 956 million by 2023. This is a significant increase from 562 million recorded in 2017, attracting further investment.
Q.What specific growth opportunities has Frost & Sullivan identified within the Chinese mobile payment market?
What specific growth opportunities has Frost & Sullivan identified within the Chinese mobile payment market?
Frost & Sullivan highlights rural region penetration and addressing the elderly market as key growth opportunities. These areas present significant potential for service expansion within China.
Q.What are some benefits of mobile payments in China, particularly in rural areas?
What are some benefits of mobile payments in China, particularly in rural areas?
Mobile payments provide a strong incentive for purchasing smartphones that enable these features, driven by eCommerce. They also offer a social aspect that builds trust and helps in learning about digital services, especially in rural communities.
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