PayPal the U.S. FinTech giant, is recorded the first international company to own 100% of a Chinese company in China.
According to PayPal’s annual report, they intend to venture deeper into the world’s leading online business-oriented marketplace.
According to the National Enterprise Credit Information Publicity System, NECIPS, shareholder data. – On the 31st of December 2020, the U.S. FinTech giant secured more value to its net worth with the 30% stake they acquired from the Asian payment platform dubbed GoPay, which was previously named Goufubao Information Technology Co.
Although, they did not reveal the financial information about the dealings according to the NECIPS data. The acquisition was made possible a year later after PayPal purchased above 70% of GoPay’s shares.
Simultaneously, both parties were discreet about the transpired dealings and complete information on how the U.S. FinTech giant became the first prominent foreign company licensed by the Chinese government to conduct business autonomously in China has been kept close the chest.
However, PayPal declined to comment about its recent development. Still, they are more concerned about impacting the Asian economy with their payment platform.
GoPay is an emerging payment platform in the Chinese e-commerce market. The acquisition by the U.S. FinTech giant – possessing absolute control over the small-time FinTech company gives PayPal the verge to dominate the world’s leading fintech sector.
The U.S. FinTech giant is expected to compete with the co-existing FinTech giants such as Tencent Holding Ltd owned WeChat Pay and Alibaba’s Alipay, whose ownership is tied with Ant Group.
The Chinese economy gradually expands as its financial sector takes the lead, whereas the Chinese government instigated the development of Beijing’s antimonopoly campaign”.
Before PayPal’s recent acquisition, the Chinese government has been probing its renowned Alibaba Group Holding Ltd, amongst other top Chinese tech companies.
During the previous summer, Hannah Qiu was assigned by PayPal to run its business affairs in China. Her position is responsible for devising long-term business strategies. Her actions determine PayPal’s developmental growth in the world’s second-largest economy.
According to the U.S. FinTech giant, Hannah Qui was the previous senior executive of an insurance company, Ping An Group – she served as a representative of the insurance company unit, OneConnect.
In its 2019 annual report, PayPal stated that they look forward to venturing into the world’s second-largest marketplace to expand its business operations. It enables them to provide cross-border payment solutions to the consumers and merchants involved in China’s socio-economic activities.
The GoPay acquisition placed the largest U.S. online payment company on the verge of connecting the Chinese commerce or e-commerce ecosystem to a universal network.
The payment giant is expected to start competing with other Chinese companies directly from inside China and this may have a long-term effect on the Fintech sector in China. What is yet to be seen is if they would be onboarding some of their policies in China. In China many things are still largely controlled by the government which may make it difficult for PayPal to implement some of its western polices in China.
The Chief Executive and co-founder of the Shanghai-based startup Fintech company XTransfer, Bill Deng – has already initiated a PayPal dream in his home country. XTransfer payment platform issues cross-border cash transactions for potential users in the Chinese marketplace.
“We see ourselves as China’s PayPal in cross-border business,” Deng acknowledged the U.S. FinTech giant as a big company but adds there is room for both of them to operate in the Chinese market.