Chinese eCommerce Data Shows Significant PayPal User Transactions

paypal mobile payment

Are you an active PayPal user? It’s not surprising if you bought something from a Chinese online store.

PayPal users are fans of Chinese online retailer sites. Internet Retailer reports that 25% of PayPal users have made an online purchase from a Chinese ecommerce retailer. More than 40 million users have purchased from a Chinese online retailer 2015. The study shows that PayPal’s userbase are active customers of Chinese online stores.

Online retailer sites from China have become a favorite destination for international online shoppers. PayPal Holdings Inc. has released a report saying says that 25% its users outside of China made at least one purchase from a Chinese e-retailer in 2015.

Are These PayPal Transactions Outside of China?

PayPal didn’t reveal how many Chinese customers use PayPal for online transactions. There’s an estimated 188 million consumers on the planet with PayPal accounts. The interesting piece of data would be millions of Chinese web shoppers use local online payment platforms such as Tenpay and Alipay.

This suggests that PayPal’s customer base in China isn’t that high. If PayPal’s 188 million registered users are based outside of Chine then that means around 47 million customers used PayPal to purchase from a Chinese online store in the previous year.

The top online retailer in China right now is JD.com, which ranks number 1 in the Internet Retailer 2016 China 500. The rankings are based from the online sales in China. PayPal reports that 30% of the online purchases from Chinese online stores were electronic products and 20% for fashion items.

PayPal says 30% of the orders placed with Chinese e-retailers were for electronics products and 20% for fashion items. Among the leading Chinese online retailers that accept PayPal is JD.com, No. 1 in the Internet Retailer 2016 China 500, which ranks retailers by their online sales in China, and LightInTheBox, No. 43.

Here is the percentage of PayPal members in each country who purchased from a Chinese online retailer in 2015:

Israel, 60%

Russia, 52%

Singapore, 37%

Nigeria, 36%

Australia, 32%

PayPal Gears Up for Chinese Conquest

PayPal’s gameplan at the moment is to extend its reach in China. The Chinese market is growing every year, and it’s only a substantial move for PayPal to integrate with Chinese online stores and platforms. This will allow them to entice Chinese customers to sign up on PayPal. The challenge would be how they can show their value against local players like Tenpay and Alipay.

PayPal’s payment gateway, Braintree, has already enabled UnionPay acceptance among European merchants. It could drive up business among Chinese customers that could carry over into Chinese online markets. Mastercard and Visa is now launching in China which means more good business developments in the pipeline for PayPal.

The online payment giant is planning to open 10 offices in China to expand its reach. Its former parent company, eBay Inc., has established 20 offices situated in major Chinese cities.

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