Mobile Payment Systems Case Study

Author: Yu Zhang | 275 words, 2 minutes | 2020-10-01 | Category: Notes

e-commerce, ecom6013, hku

Translations: ZH

Mobile Payment Systems

Why has China been an ideal environment to support mobile payment systems

Politically, payment licenses are controlled by government (relative financial institutions) and under strict regulation. So, tech giants like Alibaba who are qualified can increasingly develop their payment business in the early age. Plus, in the early stage of mobile payment, laws and rules are not so completed. Payment platform can utilize smart market strategies (like very high return rate) to attract more new potential users and enhance existing users’ engagement, which is effective in market expanding stage.

Economically and socially, China’s economic development was relatively slower than major developed countries such as the U. S. or Japan. And the majority of Chinese get used to spending money they already have instead of ahead-of-time consumption. Thus, credit card payment hasn’t been so popular in the past few decades (only about 0.31 credit card per capita) compared to western countries. Since the credit card payment (mainly related to the bank) is not the dominant way for daily payment, it’s possible for a new payment method to grow and domain the payment market in a “free compete” environment.

Technically, E-Commerce and internet technology has been developing rapidly in China recently. As a country with huge population and strong consumption ability, the market urgently needs a new way of payment. With the new utilization of established technologies (4G, mobile phone development, cyber security, etc.) and emerging technologies (QR-Code, information system architecture, etc.), payment platform can integrate various functions into the existing system and provide a more powerful and advantageous platform.

To sum up, China has been an ideal environment to support mobile payment systems.

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Yu Zhang


Yu Zhang

Blockchain Developer, MSc Graduate in ECIC(Electronic Commerce and Internet Computing) @ The University of Hong Kong (HKU). Love to learn and build things. Follow me on GitHub