PayPal becomes first foreign firm to fully own payments platform in China

Photo: Reuters

PayPal Holding Inc has become the first foreign operator with 100% control of a payment platform in China, according to Chinese government data, as the U.S. fintech giant eyes a bigger foothold in a booming market for online payments.

PayPal acquired the 30% stake it doesn’t already own in China’s GoPay, formally known as Guofubao Information Technology Co., on Dec. 31, 2020, according to shareholder data from the National Enterprise Credit Information Publicity System.

Financial details weren’t disclosed in the data. The stake purchase came a year after PayPal bought a 70% stake in GoPay for an undisclosed amount, then becoming the first foreign company licensed to provide online payment services in China.

PayPal declined to comment.

In taking full control of one of the smaller players in the world’s largest payment market, PayPal will compete with domestic payments giants Alipay, owned by Alibaba-affiliated Ant Group, and WeChat Pay, owned by Tencent Holdings Ltd, as China fully opens up its financial sector.

The stake purchase also comes amid Beijing’s antimonopoly campaign against Alibaba Group Holding Ltd and other Internet companies.

Last August, PayPal appointed Hannah Qiu as head of China business, responsible for formulating long-term strategy in the world’s second-biggest economy. Qiu was a former executive at insurer Ping An Group’s fintech unit OneConnect, according to PayPal‘s website.

PayPal said in its 2019 annual report its initial focus in China is to provide cross-border payment solutions to Chinese merchants and consumers, linking the country’s commerce ecosystem to PayPal‘s global network.

But in that area, PayPal also faces the prospect of competition from Chinese companies.

Bill Deng, Chief Executive and co-founder of XTransfer, a Shanghai-based payment platform start-up that facilitates cross-border money transfers for Chinese merchants, was not shy about his ambitions to emulate PayPal.

“We see ourselves as China’s PayPal in cross-border businesses,” Deng told Reuters.

Reuters

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.