PayPal is the first foreign company with a payments licence in China

PayPal has become the first foreign company to acquire a payments licence in China, after buying a majority stake in a Chinese payments group.  Guofubao (Gopay), a small Chinese online payments company, said yesterday that the central bank had approved PayPal’s acquisition of a 70 per cent stake in the company for an undisclosed sum. The deal makes PayPal the first foreign company to enter the Chinese payments market after two years of promises from Beijing that its financial services industry would be opened to overseas companies… Visa and Mastercard are among those foreign companies that have been kept waiting for licence approvals, despite rules in 2017 removing formal obstacles to market access… PayPal’s acquisition gives it access to Gopay’s various payments licences, which allow it to offer online, mobile and cross-border renminbi payments and to issue debit cards. PayPal is entering a rapidly growing market for online payments, which is dominated by two tech giants: Tencent, which runs WeChat Pay via its social-messaging platform, and Alibaba, whose payments affiliate Ant Financial owns Alipay. Third-party online payments in 2018 grew 45 per cent in value to Rmb208 trillion ($29 trillion) from the year before, according to central bank figures. 

Yuan Yang