Online Banking Trends in China: New Technologies, Competitors, and Business Models

by Hua Zhang, November 28, 2012
Industry Trends
Asia-Pacific

Abstract

Total online banking transaction value in China is expected to reach US$239 trillion in 2014. However, there are certain challenges in the market, including the homogeneity of online banking services and competition between e-commerce companies and third party payments providers.

In the past, online banking in China focused mainly on lowering the cost of banking services. Now, many banks provide online banking services, resulting in increased homogeneity and competition. What type of online banking system represents the direction of the future and will gain a competitive edge? In the report Online Banking Trends in China, Celent examines the Chinese online banking market, technology, size, competitive landscape, and emerging business models and trends.

 

“Competition between banks has resulted in a price war,” says Hua Zhang, analyst with Celent’s Asian Financial Services Group and author of the report. “Third party payments providers have established their own credit mechanisms, and many banks have developed online malls in the hope of leveraging their existing customer base.”

Online banking of the next generation will require more focus on its Internet features, using available tools to better serve customers, which includes being customer-centric, community-based, and marketing-oriented, and offering better customer analysis.

This 23-page report contains 11 figures and 7 tables.

 

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned operating unit of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

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Michele Pace
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Europe (London)
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Table of Contents

Executive Summary

1

Current Status of Online Banking in China

3

 

Online Transactions Will Reach US $239 Trillion in 2014

3

 

Online Banking Penetration Rate Reaches 65%

4

 

Market Share of Banks: ICBC Takes the Lead

5

 

Most Commonly Used Functions: Payments and Account Management

5

Development Trends in Online Banking

8

 

Innovations in Online Banking Functions

9

 

Security Remains a Challenge

10

 

Web 2.0

10

 

Competition and Cooperation in New Online Lending Models

12

 

Customer Segmentation Through Tracking Customer Footprint

12

 

Challenges Faced by Third Party Payments

14

 

Greater Focus on Network Marketing

15

 

Launch of Online Malls

16

 

Other Trends

16

Conclusion

18

Leveraging Celent’s Expertise

20

 

Support for Financial Institutions

20

 

Support for Vendors

20

Related Celent Research

21

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