Cross-border flows are increasing with astounding speed in Asia-Pacific and more specifically China
Transaction banking in China and across Asia-Pacific as well as credit card processing insights were highlighted at ACI’s Customer Connect held earlier this summer in Hangzhou. This well-attended event brought together management from China’s main banks and card processing organizations as key participants.
One of the major themes discussed and debated was the change(s) in China’s cross-border corporate and retail banking. In the latest SWIFT RMB (Reminbi, aka the Chinese Yuan) tracker report, usage of the RMB in cross-border trade involving Hong Kong and China increased 36 percent (to 12 percent of the total volume) and will continue to grow rapidly. The RMB also jumped to 7th place in the ranking of world payments currencies with 1.55 percent of total payment volume.
China is building its own global payments solution, China International Payments System, to accommodate this growth. Although originally planned to have been launched already, it will not be out until 2016 according to forecasts by industry experts. And, once online, its future is not completely clear, as the market will likely look to choose the most reliable and user-friendly product, meaning incumbent players like clearing banks in offshore clearing centers.
With such impressive growth, scalable resilience and experience are essential. Even banks in established markets such as Singapore face problems—a prominent Singaporean bank had a failure of its online and branch banking systems in 2011 that led to a supervisory action from the Monetary Authority of Singapore; international transactions only add to complexity.
On the consumer side, spending with Chinese bankcards overseas grew from USD2.9 billion in 2008 to USD68.9 billion in 2013. According to a recent UnionPay International announcement, transactions by Chinese consumers and UnionPay cardholders jumped 30 percent in the first six months of 2014 over the same period a year earlier, with popular destinations expanding from Southeast Asia to North America and Europe.
However, international and inter-regional bankcard processing is still a relatively new venture for Chinese card issuers and processors; a few foreign banks in Greater China have even had troubles in the past when shifting from legacy payment networks to UnionPay in order to comply with Hong Kong’s Monetary Authority’s plan to switch to IC cards. Complicating things further, the credit card industry is facing increasing competition from new payment disruptors—both online and mobile 3rd party payment providers.
Cross-border flows are increasing with astounding speed in Asia-Pacific and more specifically China, which will continue to be a leading force in growth of the regional fund movement. To make the best of arising opportunities, the country has to embrace the latest technological solutions and proceed decisively with establishing itself as a main transactional hub for the region.
Related Blog Posts
Payments and Fraud: The Paradox Twins
Digital commerce through web and mobile is where merchants predominantly experience shopper growth today. This has become a hugely important domain for their focus. It offers a means for international growth, new market penetration and a way to engage with shopper-hungry Millennials in their culture. Merchants frequently adopt a Digital-First, eCommerce-First or Mobile-First strategy to ensure full corporate buy-in to this strategy.
Knowing New Customers – And How Shared Data Helps in Fighting Fraud
As the eCommerce industry continues its rapid growth, the lines between physical and digital shopping are becoming increasingly blurred. These changes are creating a number of challenges for merchants, not least around customer visibility and fraud prevention.
Adding a Global Payments Layer for Future Growth
Digitization has changed the payments industry completely and irrevocably. Cash payments are in full retreat, as more people pay digitally – with more than 1.6 billion people now shopping online. The digital customer expects an extremely fast and convenient payment experience, with high security standards, and immediate availability of payments information.
Let’s Get Phygital: eCommerce Is Coming To A Store Near You
While payments vendors continue to pitch and strategize with a focus on omnichannel, the omnichannel story has already moved on.
Make no mistake – omnichannel remains important and the best vendors have solutions that provide a single cloud payments service capable of delivering a single view of the customer across stores and digital channels. And the best retailers utilize these solutions to deliver efficient cross-channel shopping experiences. Meanwhile, many other retailers get by (though seldom rise to the top) with a siloed approach.
Around The World: Taking Stock of Global eCommerce in 2019
As I head to #NRF2019 in New York City next week, I’m excited to see how some of the biggest retailers and merchants see the industry evolving over the coming year. What trends they think are going to shape 2019, and which of 2018’s buzzwords can be put to bed.
Fraudsters Don’t Wait for Peak, So Neither Should You: 2019 Fraud Strategy Starts Now!
In existence for barely two decades, eCommerce has transformed not only the way we shop, but also how retailers plan and execute their marketing strategies around the peak shopping season. Now that we’re deep into this period, retailers will have prepared for changes in buyer behaviors, relaxed their strategies to be within the limits of manageable review rate, and most important of all, put strategies in place for increased fraud attempts.
The Power Behind Payments – Is It Time for the ‘Slow Fintech’ Movement?
According to a freshly-minted piece of research from the Dutch central bank, choosing card payments over cash is not only convenient, it’s also good for the environment. The study considers everything from the origin of cotton that goes into the production of (Euro) banknotes and the environmental impact of armored vehicles to transport cash, through to the energy usage of POS card payment terminals in standby mode.
‘Soup To Nuts’ – A Multi-Layered Fraud Menu for the Holiday Season
The holiday shopping season is well underway, with Black Friday now behind us and many retailers around the world braced for higher levels of eCommerce fraud, from Cyber Monday all the way though until Christmas.
The ‘Internet of Things’ is the Game-Changing Next Step for Telcos… But What Are They Missing?
As I travel to meet new telcos and attend an array of trade shows around the globe, one discussion that comes up again and again is how the telco industry can gear up for the world of IoT. And it’s not just a topic that telcos are “a bit” interested in – the sector believes that IoT will drive the fourth industrial revolution, likening it in importance to the discovery of steam power.
The Challenge of Catering to the Anything, Anywhere, Anytime Retail Shopper
Ten years ago, retail eCommerce was a fairly simple provision; most retailers’ websites offered a small range of products with long lead times, local delivery and postal returns. Payments were mostly completed by card in the local currency, and the online customer experience was less than slick.