Chinese Mobile Payments Transactions Exceed $5.87 Trillion
A new report indicates that China’s mobile payments transactions have breached the 40 trillion yuan (approx. USD$5.87 trillion) threshold for the first time, leading to a spike in the prices for payment provider licenses.
The “China Third Party Mobile Payments Market Quarterly Monitoring Report 2018 First Quarter” (中国第三方支付移动支付市场季度监测报告2018年第1季度) released by Analysys indicates that China’s third party mobile payments market saw an on-quarter rise of 6.99% in the first quarter of 2018, with total transactions hitting 40.36 trillion yuan.
Alipay held a market share of 53.76%, while Tencent’s WeChat Pay and TenPay Vehicles laid claim to the second largest market share of 38.95%, for a joint share of 92.71%.
According to 21st Century Business Herald the surging growth of China’s mobile payments market has resulted in a spike in the price for payments licenses.
“A full license encompassing all five types of operations can even command a price of 3 billion yuan,” said one member of industry to 21st Century.
“Irrespective of whether it’s online payments, mobile phone payments, or bank acquisition business, as long as operations are nationwide, a single business license can be as high as 700 million yuan.”
In August 2016 the Chinese central bank publicly announced extensions for the first batch of 27 payments licenses, while also indicating that no further approvals would be made for an indefinite period of time.
The Chinese central bank is reportedly stepping up its scrutiny of holders of payments licenses, with the cancellation of nearly 30 licenses over the past three years.
The number of active payments licenses in China has fallen to 243 from 270 in 2015.