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Payment Preferences - China - November 2014

Published By :

Mintel

Published Date : Dec 2014

Category :

Banking

No. of Pages : 173 Pages

Although electronic payment methods are being adopted by some consumers, many remain cautious about using them. This is mainly due to worries about financial and data safety, and because people are still used to using cash or are just getting used to credit or debit cards. Electronic payment systems need a stronger marketing message about not just their safety, but also their convenience and application in many daily life situations.
Table of Content

Introduction

Definition
Report structure
Methodology
Abbreviations

Executive Summary

Market developments
Debit and credit cards
Figure 1: China – Total value of bank card transactions, 2009-19
Online and mobile payments
Figure 2: China – Total online retail market value, 2009-19
Key insights
How well are people embracing new developments?
Building regular payment habits is the most challenging task for all players to challenge Alipay
Are people still putting more trust in banks to process their payments?
Key trends
Cam Cam: Big Data doesn’t have to be a Big Brother
Life Hacking: Make my life easier
Let’s Make A Deal: Empower people in every financial decision
Leading players
Leading credit card issuers
Figure 3: China – Debit and Credit Cards: Company market share by volume, 30 June, 2014
Leading online third-party payment services
Figure 4: China – Estimated share of total third-party online transactions by leading player, 30 June, 2014
The consumer
Type of non-cash payments used
Figure 5: Type of non-cash payments used, August 2014
Payment methods used for different purchases and services
Figure 6: Type of payments used for different transactions, August 2014
Experience with third-party payment
Figure 7: Experience with different third-party payment service providers, August 2014
Reasons for trying mobile payments
Figure 8: Reasons for trying mobile payment, August 2014
Inconvenience experienced in online and mobile payment
Figure 9: Inconvenience experienced during online and mobile payment, August 2014
Attitudes towards payment methods
Figure 10: Attitudes towards payment methods, August 2014
What we think

Issues and Insights

How well are people embracing new developments?
The facts
The implications
Building regular payment habits is the most challenging task for all players to challenge Alipay
The facts
The implications
Figure 11: Conversion and lapsed user rates of key payment service providers, August 2014
Are people still putting more trust in banks to process their payments?
The facts
The implications

Trend Applications

Big Data doesn’t have to be a Big Brother
Make my life easier
Empower people in every financial decision

Recent Developments in Payments

Key points
Credit and debit cards continue to proliferate
Figure 12: China – Total value of bank card transactions, 2009-19
Figure 13: China – Total volume of bank cards issued, 2009-19
Online and mobile shopping rise from virtually nothing to become a large slice of total retail
Figure 14: China – Total online retail market value, 2009-19
Online payments key to electronic transaction growth
Figure 15: A Snapshot of online, telephone and mobile payment transaction scale in China, Q2 2014
Consumer online retail spending growth most rapid via mobile
Figure 16: Online retail users, online spending and mobile online spending, 2011-14
Credit and debit card usage continues to rise
Figure 17: Total number of bank cards by type, total and per card average annual transaction values, 2010-14
Figure 18: Average annual spend per capita by card users, 2010-14
What does it mean?

Leading Payment Providers and Innovators

Key points
State-owned banks dominate the cards business
Figure 19: China – Debit and Credit Cards: Company market share by volume, 30 June, 2014
Agric Bank dominates debit card and ICBC dominates credit card issuing
Figure 20: China – Top 5 card issuing banks by numbers of debit and credit cards issues, June 30, 2014
Top three banks dominate total card spending
Figure 21: China – Top 5 card issuing banks by total value of debit and credit card spending, June 30, 2014
Figure 22: China – Top 5 card issuing banks by average value of spending per debit and credit card, June 30, 2014
Leading third-party service providers dominated by Alipay
Figure 23: China – Estimated share of total third-party online transactions by leading player, 30 June, 2014
How key third-party players are innovating?
What does it mean?

The Consumer – Type of Non-Cash Payments Used

Key points
Almost all netizens surveyed had used online payments
Figure 24: Type of non-cash payments used, August 2014
Yet half of the consumers haven’t used mobile payment
Figure 25: Mobile payment usage over past six months, by age, August 2014
Card payment varies by age
Figure 26: Credit and debit card usage over the past six months, by age group, August 2014
Payment preferences vary by city
Figure 27: Credit and debit card usage over the past six months, by city, August 2014
Pre-paid card preferences vary by city
Figure 28: Gift card/coupon and prepaid card usage over the past six months, by city, August 2014
What does it mean?

The Consumer – Payment Methods Used for Different Purchases and Services

Key points
Cash remains king for everyday purchases
Figure 29: Type of payments used for different transactions, August 2014
The demographics of purchase habit, confidence and convenience
Figure 30: Type of payments used for different transactions, by gender and age group, August 2014
Figure 31: Type of payments used for different transactions, by monthly household income group, August 2014
Online payments not just focused in tier one cities
Figure 32: Type of payments used for different transactions, by city, August 2014
What does it mean?

The Consumer – Experience with Third-Party Payment

Key points
Alipay dominates third-party payment service providers
Figure 33: Experience with different third-party payment service providers, August 2014
Figure 34: Awareness, usage, lapsed and conversion rates of different third-party payment service providers, August 2014
Third-party payment service current and lapsed users by demographics
Figure 35: Lapsed usage rate of different third-party payment service providers, by gender and age group, August 2014
Figure 36: Lapsed usage rate of different third-party payment service providers, by monthly household income group, August 2014
Customer retention varies by city and service provider
Figure 37: Lapsed usage rate of different third-party payment service providers, by city, August 2014
What does it mean?

The Consumer – Reasons for Trying Mobile Payments

Key points
Convenience drives mobile payment uptake
Figure 38: Reasons for trying mobile payment, August 2014
Differences in mobile payment uptake by demographic group
Figure 39: Reasons for trying mobile payment, by gender and age group, August 2014
Figure 40: Reasons for trying mobile payment, by monthly household income group, August 2014
Differences in mobile payment uptake by location
Figure 41: Reasons for trying mobile payment, by city, August 2014
Figure 42: Reasons for trying mobile payment, by city, August 2014 (continued)
What does it mean?

The Consumer – Inconvenience Experienced in Online and Mobile Payment

Key points
Key sticking points to consumer adoption of mobile payments
Figure 43: Inconvenience experienced during online and mobile payment, August 2014
Inconveniences experienced by demographic group
Figure 44: Inconvenience experienced during online and mobile payment, by detailed age group, August 2014
Figure 45: Inconvenience experienced during online and mobile payment, by gender and age group, August 2014
Figure 46: Inconvenience experienced during online and mobile payment, by monthly household income group, August 2014
Inconveniences experienced differ by city…
Figure 47: Inconvenience experienced during online and mobile payment, by city, August 2014
Figure 48: Inconvenience experienced during online and mobile payment, by city, August 2014 (Continued)
And by provider
Figure 49: Inconvenience experienced during online and mobile payment, by Experience with different third-party payment service providers, August 2014
Figure 50: Inconvenience experienced during online and mobile payment, by Experience with different third-party payment service providers, August 2014 continued)
What does it mean?

The Consumer – Attitudes towards Payment Methods

Key points
Attitudes towards future opportunities
Figure 51: Attitudes towards future opportunities in payment methods, August 2014
Attitudes towards security
Figure 52: Attitudes towards security in payment methods, August 2014
Attitudes towards choice of payment
Figure 53: Attitudes towards choice of payment in payment methods, August 2014
Attitudes towards changes
Figure 54: Attitudes towards changes in payment methods, August 2014
Attitudes by demographic groups
Figure 55: Attitudes towards payment methods, by detailed age group, August 2014
Figure 56: Attitudes towards payment methods, by gender and broad age group, August 2014
Attitudes by income groups
Figure 57: Attitudes towards payment methods, by monthly household income group, August 2014
Attitudes by user groups
Figure 58: Attitudes towards payment methods, by electronic payment experience, August 2014
Attitudes by cities
Figure 59: Attitudes towards payment methods, by city, August 2014
Figure 60: Attitudes towards payment methods, by city, August 2014 (continued)
What does it mean?

Appendix – Market Size

Forecast bank card transaction value and card issuance volume
Figure 61: China – Total bank card transaction value and card issuance volume, 2009-19
Forecast online and mobile retail sales
Figure 62: China – Total online retail value and annual growth, 2009-19

Appendix – Payment methods used

Figure 63: Type of non-cash payments used, August 2014
Figure 64: Most popular type of non-cash payments used, by demographics, August 2014
Figure 65: Next most popular type of non-cash payments used, by demographics, August 2014
Repertoire analysis
Figure 66: Repertoire of type of non-cash payments used, August 2014
Figure 67: Repertoire of Type of non-cash payments used, by demographics, August 2014
Figure 68: Type of non-cash payments used, by repertoire of type of non-cash payments used, August 2014
Figure 69: Type of payments used for different transactions, August 2014
Figure 70: Type of payments used for different transactions – Buying everyday groceries, by demographics, August 2014
Figure 71: Type of payments used for different transactions – Buying household appliances/digital products, by demographics, August 2014
Figure 72: Type of payments used for different transactions – Eating at a restaurant, by demographics, August 2014
Figure 73: Type of payments used for different transactions – Paying utility bills, by demographics, August 2014
Figure 74: Type of payments used for different transactions – Booking travel, by demographics, August 2014
Figure 75: Type of payments used for different transactions – Topping up mobile phone, by demographics, August 2014
Figure 76: Type of payments used for different transactions – Buying entertainment tickets, by demographics, August 2014
Figure 77: Type of payments used for different transactions – Paying for a taxi, by demographics, August 2014
Figure 78: Type of payments used for different transactions – Paying for beauty treatment, by demographics, August 2014
Figure 79: Type of payments used for different transactions – Buying clothes and accessories, by demographics, August 2014

Appendix – Experience with third-party payment

Figure 80: Experience with different third-party payment service providers, August 2014
Figure 81: Experience with different third-party payment service providers – 99bill, by demographics, August 2014
Figure 82: Experience with different third-party payment service providers – Alipay, by demographics, August 2014
Figure 83: Experience with different third-party payment service providers –Baidu Wallet, by demographics, August 2014
Figure 84: Experience with different third-party payment service providers – China PnR, by demographics, August 2014
Figure 85: Experience with different third-party payment service providers – Lakala, by demographics, August 2014
Figure 86: Experience with different third-party payment service providers – Qiandai, by demographics, August 2014
Figure 87: Experience with different third-party payment service providers – Tenpay, by demographics, August 2014
Figure 88: Experience with different third-party payment service providers – UnionPay online payment, by demographics, August 2014
Figure 89: Experience with different third-party payment service providers – Yeepay, by demographics, August 2014
Figure 90: Experience with different third-party payment service providers – Suning Yifubao, by demographics, August 2014
Figure 91: Experience with different third-party payment service providers – Other online third-party payment platform^, by demographics, August 2014
Repertoire analysis
Figure 92: Repertoire of Experience with different third-party payment service providers in the last six months, August 2014
Figure 93: Repertoire of Experience with different third-party payment service providers in the last six months, by demographics, August 2014

Appendix – Reasons for trying mobile payment

Figure 94: Reasons for trying mobile payment, August 2014
Figure 95: Reasons for trying mobile payment, by demographics, August 2014

Appendix – Inconvenience in Online and Mobile Payment

Figure 96: Inconvenience experienced during online and mobile payment, August 2014
Figure 97: Most popular inconvenience experienced during online and mobile payment, by demographics, August 2014
Figure 98: Next most popular Inconvenience experienced during online and mobile payment, by demographics, August 2014
Figure 99: Inconvenience experienced during online and mobile payment, by experience with different third-party payment service providers – 99bill, August 2014
Figure 100: Inconvenience experienced during online and mobile payment, by experience with different third-party payment service providers – Alipay, August 2014
Figure 101: Inconvenience experienced during online and mobile payment, by experience with different third-party payment service providers – Baidu Wallet, August 2014
Figure 102: Inconvenience experienced during online and mobile payment, by experience with different third-party payment service providers – China PnR, August 2014
Figure 103: Inconvenience experienced during online and mobile payment, by experience with different third-party payment service providers – Lakala, August 2014
Figure 104: Inconvenience experienced during online and mobile payment, by experience with different third-party payment service providers – Qiandai, August 2014
Figure 105: Inconvenience experienced during online and mobile payment, by experience with different third-party payment service providers – Tenpay, August 2014
Figure 106: Inconvenience experienced during online and mobile payment, by experience with different third-party payment service providers – UnionPay online payment, August 2014
Figure 107: Inconvenience experienced during online and mobile payment, by experience with different third-party payment service providers – Yeepay, August 2014
Figure 108: Inconvenience experienced during online and mobile payment, by experience with different third-party payment service providers – Suning Yifubao, August 2014
Figure 109: Inconvenience experienced during online and mobile payment, by experience with different third-party payment service providers – Other online third-party payment platform^, August 2014

Appendix – Attitudes towards Payment Methods

Figure 110: Attitudes towards payment methods, August 2014
Figure 111: Attitudes towards payment methods – Future opportunities, by demographics, August 2014
Figure 112: Attitudes towards payment methods – Security, by demographics, August 2014
Figure 113: Attitudes towards payment methods – Choice of payment, by demographics, August 2014
Figure 114: Attitudes towards payment methods – Attitudes towards changes, by demographics, August 2014
Figure 115: Attitudes towards payment methods, by most popular experience with different third-party payment service providers in the last six months, August 2014
Figure 116: Attitudes towards payment methods, by next most popular experience with different third-party payment service providers in the last six months, August 2014

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