While the US spent the last decade upgrading its banking system, China experienced a significant revolution in payment methods. As a result, new and more advanced payment systems dominate China’s business transactions.
The new Chinese payment system consists of digital wallets, QR codes, and various payment platforms that offer alternate payment methods to process cross-border payments from international customers.
Some popular digital wallets such as Alipay running through Alibaba and WeChat running through the Tencent payment system are the leading payment platforms in China.
Such platforms have created an alternate payment ecosystem as consumers no longer need banks as their primary financial institutions.
China Union Pay international payment system, Tencent payment system, and various similar payment platforms connect merchants, consumers, and service providers.
These payment systems have replaced cards, cash registers, and how consumers make payments.
Future of the Chinese Payment System
The Chinese payment system is here to stay as it grows across the globe, with millions of merchants integrating their websites with WeChat, Alipay, and Union Pay rapidly. These three third-party payment processing platforms have recently spread to other markets across the globe.
Currently, Alipay is available in over 54 countries, while you can use WeChat in over 49 countries around the world. Union Pay China has also expanded to over 170 countries, grabbing the top spot in international markets.
With the advent of technology and the exponential growth of electronic payment methods in China, consumers now depend on cashless transactions.
They can scan the QR code at restaurants, shopping malls, and various institutions that accept WeChat, Alipay, and Union Pay China. This provides the Chinese consumer market convenience as they can also make offline payments.
Payment Methods for E-Commerce in China
With the rise of ecommerce, many consumers in China use more convenient methods of making cashless transactions. Here are some popular alternative payment methods for e-commerce.
E-wallets
E-wallets are also commonly called digital wallets that offer Chinese customers a futuristic payment method for e-stores. Digital wallets require the customers to sign up.
You have to create a digital wallet and link it to your bank account to withdraw or deposit funds. This efficient payment method enables customers to make instant payments on any platform.
When Chinese customers shop online, the e-wallet automatically fills in their information on various payment forms. Then, all they have to do is enter a password to activate their e-wallet and make instant payments via their phones.
Mobile Payments
Users all across the globe use their smartphones to make cashless transactions. Similarly, the Chinese payment system is heavily dependent on mobile payments now. Moreover, with ecommerce becoming the new norm, customers look for mobile-friendly payment methods.
Mobile payments are also popularly known as mobile money transfers or mobile wallets. This alternate payment method is efficient, quick, and reliable because users have to download the software. Next, they can link it to their credit card to make instant online transactions.
Chinese Payment Services
Merchants with a consumer market in China must become familiar with the Chinese payment services before receiving cross-border transactions. Chinese consumers have an increasing demand for services that address their needs.
International merchants with a well-established business in China must integrate their online stores with payment gateways that are familiar for Chinese shoppers.
If you want to gain more potential customers, you need to use local payment processing services and offer customized payment solutions to your Chinese consumers.
Alipay
Alipay is a reasonably popular e-wallet developed by the multinational technology group known as Alibaba Group.
This digital wallet has about 1.2 billion active users today. Thus it has become one of the world’s biggest mobile payment platforms. This futuristic payment platform is committed to providing merchants and customers with safe, efficient, and reliable online payment solutions.
Alipay’s digital wallet has transitioned from a single payment tool to a global payment platform that offers a multitude of payment solutions, services, insurance, social networking, financial management, etc.
It has become a relatively popular third-party digital payment platform in China. With over 800 million users that make over 100 million daily transactions, it is a must-have payment processing service for Chinese shoppers.
Therefore, businesses looking to expand their market in China must accept Alipay payments.
Moreover, Alipay ensures the safety of payments and minimizes data breaches and the risk of money laundering. In addition, it helps establish mutual trust between customers and merchants and strengthens the Chinese payment system.
Alipay simplifies the complex payment ecosystem in China. Thus, it covers several industries such as digital communication, virtual games, air tickets, and various business services.
WeChat Pay
The WeChat client is integrated with a payment function called WeChat Pay that enables users to complete their transactions quickly via this payment process. WeChat Pay is a third-party payment platform under the Tencent payment system.
This dedicated payment platform provides users and merchants with convenient, reliable, and safe online payment solutions. In addition, it has a wide range of services and application scenarios that assist users in making online transactions.
All types of small and large-scale businesses can benefit from this service as it has professional operational capabilities, payment settlement solutions, and it also guarantees security.
In addition, Chinese shoppers use WeChat Pay to shop, pay bills, eat, travel, and make various purchases. Thus, WeChat Pay successfully connects a range of stores, companies, users, and merchants.
WeChat now consists of more than 1 billion active users across the globe. It is active in about 49 countries, and it supports about 16 currencies, covering more than 300 cities in the world. This is why WeChatPay is one of the leading payment platforms of the Chinese payment system, with a daily average transaction volume of 1 billion.
China UnionPay
China Union Pay international payment platform has over 25 million merchants because several hotels, public transit, schools, and restaurants accept payments via Union pay cards. China Union Pay is the Chinese bank card association. Since Union Pay is available in more than 179 countries, most banks are members of Union Pay China.
This payment platform meets the needs of all entities involved in payment processing. It is a comprehensive payment platform of the Chinese payment system.
Union Pay covers various payment methods, including certified payments, stored value card payment, quick payment, and online banking.
The six characteristics of Union Pay China are the following.
- Convenience
- Reliability
- Universal use
- Financial-grade transactions
- Comprehensive merchant services
- Multitude of online payment solutions
Union Pay China speeds up the transaction process and eliminates the need for online banking. It also offers an improved user experience and helps merchants receive payments on time.
The faster payment processing also helps attract more customers, promoting online transactions. In addition, Union Pay employs various security measures such as real-time risk monitoring and advanced encryption to ensure the safety of online transactions.
Most payment platforms transfer a customer’s payment to a third-party account. Unlike this, Union Pay freezes the funds in the cardholder’s account. This minimizes the interest loss and capital misappropriation risks.
The Union Pay network has expanded globally as more merchants allow cardholders to use Union Pay cards.
Oceanpayment | All-In-One Solution for Processing Chinese Payments
With the advancement of the Chinese payment system, various payment processing services are now available for merchants. Businesses need a reliable and secure option for their ecommerce store to process Chinese payments.
Oceanpayment is a certified third-party payment platform that guarantees safe payment transfer. It offers a multitude of payment solutions and supports various user interfaces such as mobile, desktop, and TV, allowing users to make payments via any channel they find best.
Suppose you want to expand your business to China, but your primary concern is processing cross-border e-payments. Oceanpayment will address your concern by providing you with the most futuristic and reliable payment processing methods.
If you sell products in the Chinese market and your customers do not use Visa or Mastercard, the chances are that they will abandon their carts at the checkout. Thus, you must provide your Chinese customers with local payment processing services like Alipay, WeChatPay, and Union Pay.
This is why understanding the prerequisites of the Chinese payment ecosystem requires the fundamental knowledge of WeChat, AliPay, and Union Pay, as these are the primary payment platforms that dominate the Chinese market.
Final Words
Since China has become a mainstream market, integrating your online stores with alternative payment methods is vital for a business to grow in China.
Oceanpayment, a global payment service provider, has certification of China’s third-party payment platforms. Therefore, we help thousands of businesses expand their market to China by providing local payment processing methods. This results in a higher conversion rate for ecommerce stores as fewer customers abandon their carts at the checkout.
Moreover, Oceanpayment is a safe global payment service that offers you end-to-end encrypted fund transfers. Consulting Oceanpayment allows merchants to collect payments from Chinese consumers as we support the local Chinese payment methods, including WeChat Pay, UnionPay China, and Alipay. All you have to do is get in touch with Oceanpayment via phone call or contact form.
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