In 2019, PayPal (NASDAQ: PYPL) acquired a 70% stake in China-based GoPay (formerly Guofubao Information Technology), making it the first foreign payments firm to operate in China. More recently, according to Reuters, PayPal doubled down on its growth strategy in the region and acquired the remaining 30% of GoPay.
PayPal is now the first and only foreign firm to own a payments platform in China, the world’s largest payments market. That’s a big deal for the fintech company — here’s what investors should know.
Compared to the U.S., mobile payments are more much common in China. In 2020, for example, 56% percent of the Chinese populace used mobile wallets to make at least one proximity payment, and 33% of all point-of-sale transactions were funded with a smartphone. By comparison, only 31% of U.S. smartphone users made proximity payments with their device in 2020, and smartphones accounted for only 15% of U.S. point-of-sale transactions.