Chinese banks thrive on mobile payments as millennials drive cashless push
Lenders handled a whopping $11.1t in mobile payments in the first quarter alone.
The volume of mobile payments handled by Chinese banks rose 16.8% YoY to a whopping $11.1t (70.8t yuan) in Q1, according to central bank data, as the country accelerates its cashless push.
Around 10.7b payments were made through the banks' mobile services in the first quarter which represents an increase of 17.8% on a year on year basis, the People’s Bank of China said.
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China’s mobile payment sector continues to thrive as banks ramp up fintech adoption to keep up pace with the country’s mobile payment giants Alipay and WeChatPay who are setting their sights abroad. It helps that the tech-savvy population has long jumped on the cashless bandwagon and continued improvements to the IT infrastructure has lent assistance to the cashless push.
E-payment systems also have higher take up rates in China than Hong Kong and Japan, according to BMI Research, thanks to the country's massive young population which has demonstrated an openness to embrace new technology, lending support to the cashless agenda. In addition, China will continue to have the highest youth population in North Asia (23.6% of total) in 2027, standing considerably above the regional average of 21.3%.
"The push towards a cashless society also appears to be spearheaded by the younger generation, where apps such as WeChat are used to transfer money as wedding gifts and to pay for food in restaurants. We believe that this trend is likely to continue as China’s population ages more slowly than its peers and forecast the 15-29 years to account for 16.7% of the population in 2027 in contrast to an average of the regional average of 14.8%," added BMI.