According to GlobalData’s 2023 Financial Services Consumer Survey, carried out in Q2 2023, the Chinese e-commerce market is anticipated to grow at a compound annual growth rate (CAGR) of 9.9% between 2024 and 2028 to reach CNY25.4trn ($3.6trn) in 2028, driven by the ongoing shift in consumer preference from offline to online shopping.
Ravi Sharma, lead banking and payments analyst at GlobalData, believes China boasts the largest e-commerce market globally, attributing it to the country’s massive population, increasing internet penetration (especially in rural areas), and advanced digital infrastructure.
Sharma noted that online shopping events such as Singles’ Day, 618 e-commerce festival, and Shuangpin online shopping festival have also contributed to e-commerce growth in China.
As per the China Internet Network Information Center (CNNIC), internet penetration in urban areas in China stood at 83.3% as of December 2023, while rural areas had a penetration rate of 66.6%.
In October 2021, the Ministry of Commerce, the Cyberspace Administration of China, and the National Development and Reform Commission jointly released a plan for e-commerce development during the 14th five-year plan, which covers 2021–25.
GlobalData emphasised this plan includes initiatives such as enhancing the country’s logistics network, establishing cross-border e-commerce zones, and expanding e-commerce to remote areas.
The survey revealed that alternative payment solutions dominate the e-commerce space in China with a combined market share of 65.9% in 2023.
Meanwhile, Alipay and WeChat Pay, with more than one billion worldwide users each, are the most popular alternative payment methods and gained prominence due to their simplicity, speed, and convenience. It found that international brands such as Samsung Pay and Apple Pay are also available in the market.
GlobalData highlighted that alternative payments are followed by bank transfers and payment cards, while, cards accounted for a 14.9% share of e-commerce transaction value in 2023.
Credit cards were noted to be more preferred than debit cards reportedly due to the value-added benefits they offer such as interest-free instalment payment options, reward programs, cashback, and discounts.
Sharma concluded: “The Chinese e-commerce market is expected to register an upward growth trend supported by government initiatives, robust payment infrastructure and high internet penetration. Alternative payment solutions driven by Alipay and WeChat Pay are likely to continue their dominance driven by their growing userbase and high merchant acceptance.”
