China’s third-party mobile payment gross merchandising volume (GMV) expanded almost fourfold (391 per cent) last year to CNY5.99 trillion ($970 billion).
After two years of explosive growth (700 per cent in 2013), Beijing-based iResearch predicts growth will start to slow down, with GMV reaching CNY18.25 trillion in 2018.
The company said the growth is being driven by internet users shifting from PC to mobile devices, new age groups using the mobile internet and new use case for mobile payments.
Alibaba’s Alipay had an 83 per cent share of the third-party mobile payment market, while Tencent’s Tenpay had a 10.6 per cent share (see chart below, click to enlarge). Alibaba, with a huge user base, has a huge advantage over traditional third-party online payment companies, iResearch said.
Tenpay, meanwhile, is benefiting from growing usage of Tencent’s WeChat Payment.
The research firm noted that other players are focusing on niche markets. Lakala offers payment services for community e-commerce and finance for small and micro businesses. Umpay, 99bill and Lianlianpay have emphasised in-app payments.