Daily Digital Pulse of China: Online Spending
China is Spending More and More Online
With the people of Guangdong province leading the way, China’s online spending keeps on increasing. The latest data from Alipay tells us that the nation’s per capita online transactions, which incloude shopping, money transfers, and bill payments, came out to over 10,000 RMB (US $1,642) last year. Spending in Guangdong accounted for 16% of 2012’s online spending. As a whole, the spending of tier-1 cities is the greatest, but Alipay has also noted that smaller cities were not to be ignored. For example, shoppers in Yiwu (Zhejiang province), spent an average of 40,000 RMB ($6,569USD) last year, which is more than twice the amount of the average in Beijing. Alipay’s list of top 100 small cities and counties, 36 belonged to Zhejiang province, 27 from Jiangsu, and 13 from Fujian. Shoppers who spent over 1 million yuan ($164,219 USD) were from Yiwu and Cangnan counties, in Zhejiang province, and Changshu, located in Jiangsu province. Analysts have said that although those in lower-tier cities may have lower income than those in higher-tier ones, due to lower living costs, they may actually have as much or even more disposable income to spend online.
Chinese Internet and e-commerce giants are transforming the country’s financial industry. Internet powerhouses have begun introducing financial products for their customers. The most notable financial product to date is Alibaba’s Yu’E Bao. Yu’E Bao is a money market fund where users can place their savings. This fund is invested and is currently earning interest that is greater than any of China’s banks – around 7%. At the end of last year, Yu’E Bao had 43.04 million users with a collective deposit of $30.4 billion US dollars. This value makes Yu’E Bao the largest single public fund in China. Consumers can access this fund with as little as 1 Yuan, thus highlighting the spirit of the Internet – being open with a bottom up approach. These types of funds are gaining popularity amongst consumers as the government has a strong grip on interest rates. In October, Baidu announced its online wealth management product Baifa and NetEase released Tianjin.
Source:Want China Times