Payment deal opens China’s online trade
China’s fast-growing cashed-up middle class is fuelling a boom in online retailing with eCommerce sales up 66 per cent in 2011.
Now online payments processor WorldPay has secured a partnership with China’s UnionPay, the fastest growing card scheme in the world, to enable seamless cross-border payments.
The deal means more online retailers outside China will be able to sell to Chinese consumers who typically do not own western-brand credit cards – and facilitate purchases by people outside China using payment methods acceptable to vendors.
The WorldPay and China UnionPay partnership will see WorldPay become the biggest acquirer outside of China for eCommerce UnionPay transactions. The agreement will see WorldPay become the first UnionPay Online Payment acquirer in the US and the vast majority of Europe, to enable merchants to sell directly to consumers in China, as well as UnionPay cardholders outside of China.
Gabriel Hopkins, head of eCommerce products with WorldPay, said China is rapidly overtaking many nations to become one of the biggest spending powers in the world.
“eCommerce has removed geographical boundaries, opening up the opportunities for merchants to sell to consumers regardless of country or origin. WorldPay will soon offer merchants the opportunity to accept China UnionPay transactions online, the biggest card scheme in China.”
“Merchants will be able to tap into this enormous spending power and sell directly to consumers in China as well as UnionPay cardholders around the world,” said Hopkins.
Research from the state news agency Xinhua and IDC concluded that online sales in China in 2011 totalled 780 billion yuan, or (US$125 billion).
But this represents only a small proportion of the enormous spending power of the Chinese, where the middle class population alone has already risen from 35 million households in 2006 and is expected to top 100 million by 2016. The number of dollar millionaires rose 10 per cent in a year to 960,000.
Yet online sales account for just three per cent of total retail sales in China, expected to grow to seven per cent in 2015.
There are 500 million internet users in China.