Market Context Chinese mobile payment industry is the largest in the world with a transaction value of USD 2.1 trillion in 2016. Chinese consumers have been proactive towards using mobile payments for fund transfers, bill payments as well as online purchases. Smartphones are very popular in the market which has increased adoption of mobile payments. Key players in this market are Alipay and WeChat Pay with market share 68% and 20%, respectively. However, new players such as Apple Pay and Samsung Pay have been gaining market share. Market Innovation - Key Insights Apple is one of the top smartphone brands in China. Apple Pay registered 30 million bank cards within two days of its launch in partnership with UnionPay in February 2016. It created a strong foot hold in the market with associations to food delivery service Meituan, e-commerce website JD.com and online travel agent Qunar. It is continuously working towards bringing in more brands under its umbrella since then. Other smartphone brands have also been proactive towards launching their own mobile payment services in China. Samsung also partnered with UnionPay to launch its Samsung Pay in the market just one month after Apple Pay. Additionally, it integrated Alipay into its e-wallet as well. Huawei launched its mobile payment service in August 2016 with partnerships from 24 banks currently. Among others, Xiaomi launched Mi Pay in September and LeEco is building its payment infrastructure. Alipay’s market share has decreased from 80% in 2014 to 68% in 2015 while Tencent share has closely doubled from 12% to 20% during same period. It is quite evident that new players are likely to increase competition in the market and anticipated to launch new services to draw in more customers. PayNXT360 View PayNXT360 expects rate of innovation to increase over the next two years with the entry of new players. It would be interesting to see how Alipay defends its market share. While the Chinese market is large enough to for 8-10 players, PayNXT360 expects consolidation in the industry over the medium term.

1. New players intensify competition in the Chinese
mobile payment industry
Analyst View Point Series

2. Table of Contents
Market Context
Market Innovation - Key Insights
PayNXT360 View

3. Market Context
Chinese mobile payment industry is the largest in the world with a transaction value of
USD 2.1 trillion in 2016. Chinese consumers have been proactive towards using
mobile payments for fund transfers, bill payments as well as online purchases.
Smartphones are very popular in the market which has increased adoption of mobile
payments. Key players in this market are Alipay and WeChat Pay with market share
68% and 20%, respectively. However, new players such as Apple Pay and Samsung
Pay have been gaining market share.

4. Market Innovation - Key Insights
Apple is one of the top smartphone brands in China. Apple Pay registered 30 million
bank cards within two days of its launch in partnership with UnionPay in February
2016. It created a strong foot hold in the market with associations to food delivery
service Meituan, e-commerce website JD.com and online travel agent Qunar. It is
continuously working towards bringing in more brands under its umbrella since then.
Other smartphone brands have also been proactive towards launching their own
mobile payment services in China. Samsung also partnered with UnionPay to launch
its Samsung Pay in the market just one month after Apple Pay. Additionally, it
integrated Alipay into its e-wallet as well. Huawei launched its mobile payment service
in August 2016 with partnerships from 24 banks currently. Among others, Xiaomi
launched Mi Pay in September and LeEco is building its payment infrastructure.

5. Market Innovation - Key Insights
Alipay’s market share has decreased from 80% in 2014 to 68% in 2015 while Tencent
share has closely doubled from 12% to 20% during same period. It is quite evident
that new players are likely to increase competition in the market and anticipated to
launch new services to draw in more customers.

6. PayNXT360 View
PayNXT360 expects rate of innovation to increase over the next two years with the
entry of new players. It would be interesting to see how Alipay defends its market
share. While the Chinese market is large enough to for 8-10 players, PayNXT360
expects consolidation in the industry over the medium term.

7. To Know More
To know more and gain deeper understanding of
mobile payment industry in China, click here.