US online payment platform PayPal has acquired China’s payment company GoPay (国付宝), making it the first foreign third-party payment platform in China.
GoPay was founded in 2011 by China International Electronic Commerce Center (a subsidiary of the Ministry of Commerce) and Guofutong Information Technology Co. PayPal bought 70% of GoPay’s shares in December 2019 but gained full ownership earlier this week after the additional 30% were sold to its China subsidiary, American Yinbao Information Technology (Shanghai) Co.
This marks a move by PayPal to increase its presence in the Chinese market. As China’s domestic payment market is fairly saturated, PayPal will focus on cross-border payment services through its acquisition of GoPay. It is likely to develop cross-border consumption features which target Chinese users and cooperate with international card organizations such as Visa, MasterCard, and American Express.
The deal also highlights an openness towards foreign companies at a time when China’s domestic companies are facing increased regulation.
Read more about China’s online payment market:
- Alipay & WeChat Pay among Chinese apps targetted in further Trump ban
- Bilibili plans to launch payment system
- Record-breaking Ant Group IPO halted by Chinese regulators
- Chinese fintech, techfin and digital currency – an interview with Yassine Regragui
