Beijing, China (FT.com) -- PayPal, the world's largest online payment platform, is planning an expansion in China, a move that could strengthen its parent Ebay in the expanding e-commerce market.
Through a co-operation agreement with the government of Chongqing, China's largest municipality, PayPal plans to offer a range of services -- including, for the first time, a foreign exchange settlement solution -- to Chinese entrepreneurs selling to consumers overseas.
China's online payment market had a transaction volume of Rmb725.5bn in the first nine months of this year and is expected to hit Rmb1,000bn ($151bn) for the whole year, according to Analysys, a Beijing-based internet research firm.
Chinese authorities have set a ceiling for individuals to convert foreign currency into local currency of $50,000 a year. PayPal said this regulation hindered small businesses and entrepreneurs from building a cross-border e-commerce business, and its payment platform would help small merchants get quick access to an export licence, which allows a higher conversion ceiling.
"The Chongqing government will be working with the relevant local authorities, like the Safe Administration of Foreign Exchange, to get the necessary regulatory approvals," said Dickson Seow of PayPal Asia Pacific.
The service has begun testing, and PayPal hopes to offer it to merchants all over China in the second half of 2011.
If successful, the platform should attract small Chinese vendors, the main customer base of Alibaba, the world's largest online marketplace for trade between companies, which had proved the nemesis for Ebay on its first foray into the Chinese market. The country has the world's largest online population with 440m users.
Ebay initially entered China with an auction site closely resembling its international service. After losing most of its market share to Taobao, the unlisted affiliate of Alibaba Group which dominates China's consumer-to-consumer e-commerce market, the US group changed strategy in 2006 and offered a platform for cross-border online trade.
Over the past year, Alibaba and Ebay have worked on opportunities for co-operation. However, AliExpress, a site launched by Alibaba this year that allows small online transactions between merchants and customers overseas, again put Alibaba in competition with Ebay's business in China.
Alibaba also has its own online payment service, Alipay, which dominates the Chinese market.
The Chongqing government's partnership with PayPal is an attempt to attract services linked to China's booming e-commerce industry to set up in the city. Hangzhou, the city where Alibaba's headquarters is located, has already succeeded in attracting services such as logistics, boosting the local economy and creating service sector jobs.
PayPal and Chongqing said that, in additional to the foreign currency settlement platform, they would set up five international e-commerce centres providing services such as training and verification to merchants.
The alliance comes as China prepares to regulate its third-party payment services more clearly. Providers of such payment platforms are required to apply for a licence by September next year, according to the central bank.
Source: CNN
http://edition.cnn.com
No comments:
Post a Comment