PayPal Holding Inc becomes the first foreign firm in China with 100% control of Payment Platforms, according to the Chinese Government. This US-based mega-giant fintech corporation had its eyes on the Chinese online payment market and leaps it successfully.
According to Reuters, PayPal acquired a minor portion of about 30% stake of China’s GoPay (known as GuoFubao Information Technology Co.) and later taking a major 70% of the remaining stake in GoPay. Thus, Paypal becomes the first-ever foreign organization to get the license of providing Online Payment Services in China.
Although PayPal acquired the early 30% of Stakes of GoPay on 31 December 2020, the amounts were still disclosed- according to the ShareHolder Data From National Enterprise Credit Information Publicity System.
China is without a doubt, a country with the highest population and also an Independent country. Daniel Schulman, the current CEO of PayPal sees the opportunity of the online market in China, takes over the minor players of the payment market. Crowning as one of the biggest payment gateways, PayPal now will set foot against the other giants, Alipay – owned by Alibaba Affiliated Ant Group, and WeChat Pay– owned by Tencent Holding Ltd, as China resumes all of its financial sectors.
In all this run, Beijing’s multi giant company Alibaba Group Holding Ltd. foresees a bigger competition along with other Internet Companies in China.
Last August, Hannah Qui was appointed as head of China business by PayPal to formulate the long-term strategy to cover up the world’s second-biggest economy. It looks like Hannah Qui certainly succeeded in doing so. Qui had also carried the experience as a former executive at an insurer Ping An Group’s fintech unit OneConnect as per PayPal’s website.
Back in 2019, when PayPal released its annual report, the company announced that its primary focus in China is to make cross-border payments accessible to Chinese merchants and consumers. With the help of Paypal’s Global Network, it will also help the Chinese Merchants and Consumers, to link with international merchants and consumers.
However, Paypal Knows that it has to face a head to head competition with Chinese Competitors.
In this regard, Bill Deng, the Chief Executive and co-founder of XTransfer, a Shanghai-based payment platform that helps Chinese Merchants to make cross-border payments, don’t step back to start the rivalry with PayPal.
“We see ourselves as China’s PayPal in cross-border business,” Deng clears to Reuters.
In the upcoming days, we will see whether PayPal rises in the Chinese online payment market? Also, how would PayPal perform and stand out in competition with the Chinese domestic online payment players? As China had heated trade disputes with the US Trump’s government, now this could be seen as the first ray of hope among US tech investors while president-elect Joe Biden is coming into power shortly.