Big Banks Are Losing Grounds To China’s FinTech Rivals

Big Banks Are Losing Grounds To China’s FinTech Rivals

With the rapidly increasing online payment firms, mobile payment methods are also gaining dominance. During a meeting at the Rise Conference in Hong K

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With the rapidly increasing online payment firmsmobile payment methods are also gaining dominance. During a meeting at the Rise Conference in Hong Kong last month, Vice Chairman of Asia Pacific at JP Morgan Chase – Jing Ulrich publicly acknowledged their failure to keep pace with the FinTech rivals. She further heaped praise on the two online payment firms; Tencent’s Tenpay and the Alibaba Group’s Alipay.

According to a report by the South China Morning Post, the Asia Pacific Managing director explained how mobile banking is dominating the FinTech sector. Jing Ulrich explained that while JP Morgan processes 94 million payments per year through the Quick pay, Tencent Company processes 46 billion payments in just five days. This is equivalent to 800 million transactions per hour. She also added that Visa has a limited transaction with the maximum capacity of 25, 000 payments per second while Alipay, for example; can process 50,000 payments per second.

One of the most used payment platforms in China is the Alipay financial application developed by Ant Financial. The platform has more than 900 million accounts with 350 registered & active users. The high performance of the financial firm is clearly depicted by the $60 billion market cap value in January. It’s undoubtedly clear that Alipay is determined to taking over the China’s FinTech industry as it continues to attract the traditional banking customers.

Tencent is the other online payment firm that’s behind the development of one of the China’s largest messaging app – WeChat. The Messaging app has more than 800 million daily users and subsidiaries within the internet & mobile phone value added services. There are rumors that the company is developing a block chain platform to boost it service delivery.

Goldman Sachs, the American multinational finance- company has also noted the dominance of FinTech companies in China. As from the year 2010- 2016, third party payments have grown to over 70 times; from US dollars 155 billion to US dollars 11.4 trillion. The Peoples’ Bank of China has also acknowledged the rise of online payments through the Non- bank services. Online payment sector is gaining popularity in the country as more people shift from the traditional banking methods to the most convenient alternatives.