China setting the trend for Mobile Payments

China Trends

Ivan Walsh/Flickr

February 1, 2014 8:00 PM
Tracey Xiang, TechNode

The total transaction volume by Chinese independent mobile payments services reached 1219.74 billion yuan (roughly $200 billion) in 2013, a 707 percent year-over-year increase, according to the latest report by online tracking and data analysis service iResearch.

The independent services iResearch refers to are all payments services excluding those by conventional banks and China UnionPay, the bank card association. And payments include peer-to-peer money transfers.

The major driver of the growth, however, isn’t mobile shopping anymore, but online money transfers, credit card payoffs, and other mobile payment applications.

Payments via text messages decreased steeply in the past three years, from 92.5 percent in 2010 to 6.1 percent in 2013. Last year, 93.1 percent of payments were through mobile payment apps or other services.

The share of near-field communication (NFC) payments declined from 2.6 percent one year ago to 0.8 percent — NFC, the only mainstream near-field technology, isn’t widely adopted in China. But it is expected that other near field payment solutions like Alipay On-site, with QR code and acoustic payment capability, will drive near-field payments in 2014.