China: Leader in FinTech with $2.9 Trillion Annual Transaction


In 2016, Chinese mobile payment systems, such as Alipay and WeChat Pay, reached approximately $2.9 trillion annual transaction volume. The annual transaction increased by twenty-fold within 4 years, which surpassed the estimated $1.7 trillion from 2012.

On April 20th, “Social Networks,  e-Commerce Platforms,  and the Growth of Digital  Payment Ecosystems in China:  What It Means for Other Countries” case study by Better Than Cash Alliance reported such high volume of transaction and underscored the transition from cash payment to digital payment and its effect on the public.

Another transition was also noted in savings and investment. For instance, Alibaba’s Yu’E Bao (MMF) provides various investment opportunities. The low-income class can use their money on digital accounts to invest and increase their savings in the long run. Since 2013, Yu’E Bao hit $117 billion in 2016 and reached 152 million active users. Moreover, FinTech allows small businesses to actively seek loans. In September 2016, Ant Financial alone issued $100 billion loans to 4.11 million businessmen.

The case study also highlights that Alipay and WeChat invest in other digital payment companies around the world. Alipay and WeChat especially target countries with a high concentration of smartphone users and the government’s willingness to cooperate with the private sector. The likely target countries are South Africa, India, and Indonesia.

In South Africa, 78% of internet traffic comes from mobile, which is one of the highest percentages in the world. However, only 15% of the population purchase products using mobile phones. Looking at market infrastructures for FinTech, South African market closely resembles the Chinese one. 59% of the population uses social media and 52% connects to SNS using their phones. Yet, the market for digital payment is small and there isn’t really an appropriate platform to take advantage of this opportunity.

India is another promising market. Ant Financial and Tencent already expanded their business to India. For instance, Ant Financial invested $900 million in Paytm and is working to implement their technology. As a result, active users of Paytm increased from 5 million to 200 million within a few years.

Indonesia is the fastest growing country in terms of mobile commerce adoption in 2016. From January 2016 to January 2017, the market grew 155%. Such remarkable growth is attributed to the instant mobile payment service by BBM Pay in 2015. BBM Chat currently has 55 million registered users and the user base is growing continuously.

Finally, the case study estimates that developing countries’ GDP would increase by 6% with 95 million new jobs by 2025.

Ruth Goodwin-Groen, Managing Director of Better Than Cash Alliance, explained, “Social Network and E-commerce is growing in every country, both small and big. Chinese digital payment market is flourishing under those channels and encouraging more economic activities.”
– Inspired by Platum

Joyce (Jung Min) is a senior at Georgetown University’s School of Foreign Service, majoring in Global Business. In her free time, she loves to drink coffee, listen to music and explore downtown DC. Joyce can be reached at


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