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China’s third-party payment market had total transactions reaching US$1.127tn in the first half of 2013; China UMS is the leader in the nation’s third-party payment industry, taking a market share of 46.3%, followed by Alipay with 17.8%

Third-party payment market in China worth RMB7tn so far this year

Liao Kuei-ju and Staff Reporter

2013-08-04

In the first half of 2013, China’s third-party payment market had total transactions reaching 6.91 trillion yuan (US$1.127tn), already achieving 66% of last year’s total, our sister paper Commercial Times reports, citing the China Electronic Information Industry Development Institute. The mainland is seeing slowing economic growth but its e-commerce industry has outperformed, with sales jumping more than 100% a year. To grab a slice of the pie, international credit card giant Visa in April began its certification program for third-party payment companies. On Aug. 1, Chinese third-party payment company Tenpay announced it will begin offering secure third-party payment services for international credit cards immediately.The hot business of third-party payments in China has triggered buying on internet-related stocks, with Zhejiang Hithink Flush Information Network Co on Thursday surging by the daily limit after announcing it will found a third-party payment unit. Other related shares such as Toocle.com and East Money Information Co jumped 7.31% and 7.65%, respectively.

In July, after the central People’s Bank of China issued the seventh round of third-party payment licenses, there are a total of 250 such companies.

China UMS is the leader in the nation’s third-party payment industry, taking a market share of 46.3%, followed by Alipay with 17.8%, and ChinaPnR third (no figure available).

In the first half of the year, China’s total transactions in third-party payments reached 6.91 trillion yuan, with bank cards and internet payments accounting for 4.46 trillion yuan (US$727.6bn) and 2.27 trillion yuan (US$370.3bn), jointly taking 97.4% of the total. Mobile payments made up only 1.5% of the total.

Although the mobile payment market is small at present, it is gradually expanding, with third-party payment firms keeping up investment in related technologies. As of the first half of 2013, China’s mobile payment market saw 99.34 billion yuan (US$16.2bn) in transactions, according to CCID Consulting.

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About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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