iResearch recently released an exhaustive report on online payments in China. Here are the highlights:
- Third-party online payment transactions reached 80 trillion in China in 2016
- Mobile transactions made up 74.7% of the volume
- Third-party online payments grew at a 300% YOY rate
- Transactions from offline QR code scans reached 300 billion RMB in Q4 2016, with an impressive 85% quarterly growth rate
Growth of third-party online payments
Third party online payments started an explosive growth from 2011 to 2016 (reaching nearly 80 trillon RMB of yearly transaction volume). PC transactions used to dominate the market, but mobile quickly caught up.
In 2015, mobile payments. had barely caught up with PC payments. By 2016, mobile amounted to almost 3 times more transactions than PC.
The total number of non-payment transactions (including bank cards) has been growing at a steadier pace (with a yearly growth rate of about 30% on average)
Offline transactions via QR code have been booming, with a growth rate of 86% during Q4 2016. This trend was certainly pushed by the impressive growth of WeChat payment.
Usage habit of online payments
Mobile online payments are completely dominating all categories. The only category with a still significant proportion of PC payment users is Financial Products.
Bank cards are actually still dominating the purchase of financial products, with Alipay being a close followers and WeChat Payment lagging behind.
There is a very clear age-gap when it comes to switching from PC to mobile payments. The younger generations are much more likely to use Alipay (48% of them do) while the older generations – 60 years old and above – is more likely to use bank cards for transactions (74.4% of them do).
Conclusion
Third-party payments and mobile payments have been booming through the impulse of Alipay and WeChat Payment.
Although these new method of payments are now ubiquitous, it is a newer trend than we think (it’s only in 2015 that mobile payments caught up with PC payments).
The continuous growth rate shows that this trend is far from slowing down, especially given the growth opportunities outside China largest cities.