Low credit card usage and increasing popularity of eCommerce in China have accelerated the growth of mobile payments in the country.
With a growing middle class, China has seen an increase in cross-border payment transactions. The primary growing sectors are eCommerce, travel and overseas education. Frost & Sullivan recently reported that nearly 65% of Chinese tourists have used mobile payments abroad. It is 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.