China Mobile is partnering with American Express to offer mobile payments to Chinese consumers shopping overseas.
China Mobile said customers can make payments while abroad using its NFC Hebao service, previously named Phone Wallet. Users can also add value to GlobalTravel electronic travellers cheques.
Guo Xiaoming, president of China Mobile’s e-commerce unit, told Want China Times its goal is to have revenue of more than CNY1 trillion ($164 billion) in three to five years.
The company also wants to work with domestic banks to enable funds to be transferred from Hebao accounts and American Express electronic cheques.
According to China-based iResearch, China Mobile, with 790 million connections, had just a 0.6 per cent share of mobile payment transactions in China in Q2 (see chart below). Alipay continues to lead by a huge margin, with an 80 per cent share. Tenpay (9 per cent) and Lakala (6.5 per cent) were second and third.
Other players include Umpay, China Telecom, Qiandai and Baidu’s Baifubao.
iResearch expects the value of mobile payments to increase 80 per cent a year in China, but the gross merchandise value of third-party mobile payments fell 5.8 per cent in Q2 to CNY1.38 trillion — its first decline ever. The decrease comes after a consecutive growth rate of 100 per cent in the previous quarters.
iResearch attributed the decline mainly to the sharply drop in fund subscription led by Yu Ebao. In Q1, with annual earnings up as much as 7 per cent, the fund market led by Yu Ebao was extremely hot. However, the research firm said that with the slump in earnings in Q2, the volume of new subscriptions fell.
Looking at the wider category of online payments, the transaction value dropped 1.7 per cent in Q2 to CNY1.84 trillion after growth slowed to 3.3 per cent in Q1. That slowdown comes after 27 per cent growth in Q3 and Q4 last year. Year-on-year growth in Q2 was 64 per cent, iResearch reported.