Updated 11:29 AM EDT, Tue, Jun 16, 2020

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China's Mobile Payment Industry More than Tripled to $5.5 Trillion in 2016

Third-party mobile payments in China reached $5.5 trillion in 2016.

(Photo : YouTube) Third-party mobile payments in China reached $5.5 trillion in 2016.

China's booming mobile payment network more than tripled to a staggering 38 trillion yuan ($5.5 trillion) in 2016, state media People's Daily reported on Saturday.

Nearly 86 percent of Chinese consumers use their mobile apps, instead of cash or card, to buy something online. In fact, it already outpaced other countries like the US; for instance, China in 2016 recorded 200 million mobile payment users, over five times greater than the US' 37.5 million, according to a recent study by US-based global data firm Nieslen.

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Moreover, nearly 60 percent of Chinese consumers use mobile payments to pay via mobile apps. Third-party payment apps like Alipay and WeChat turned out to become a significant part of everyday life, which allows users to shop online, pay taxes and the bills, split meal payment, and even give 'red packets' on Chinese New Year.

Alibaba's Alipay, which accounts for more than half of all Chinese mobile payments, now offers online payment and tax refund services for overseas Chinese tourists. It also promoted its "Airport of the Future" initiative, in which it partnered with airlines and airports to accommodate Chinese tourists traveling abroad. It has teamed up with local partners across the world including Europe, Southeast Asia, Japan, among others.

The significant lead of China over the US could be pointed to the country's lack of other non-cash payments available. China does not have a strong credit card culture, and debit cards are dubbed as a hassle.

Most people are lured with the convenience third-party apps gives to its clients. For instance, Alipay and WeChat only requires a QR code scanning from a retailer's terminal or smartphone to make the purchase.

Although China dominates the mobile payment growth, US is still the biggest growth driver in terms of in-person payments in offline retailers.

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