Card payments in China to rebound with 21.3% growth in 2021, forecasts GlobalData

Card payments in China have been on a sustained growth for the last few years. While the growth was affected by the COVID-19 pandemic in 2020, it is set to rebound with a 21.3% growth in 2021, says GlobalData, a leading data and analytics company.

Nikhil Reddy, Payments Senior Analyst at GlobalData, comments: “Card payments in China, which have been supported by the rising financial inclusion, growing consumer preference for electronic payments, and payment infrastructure, were affected by the COVID-19 pandemic.”


According to GlobalData’s Payment Cards Analytics, card payments are set to rise as economic activities gather pace and consumer spending improves in the wake of the COVID-19 vaccination program. The value of card payments is forecast to register a compound annual growth rate (CAGR) of 16.9% between 2020 and 2024 to reach CNY220.4 trillion (US$33.8 trillion) in 2024.

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The Chinese payment card space is dominated by debit cards, accounting for 57.4% of total card payments value in 2020 while credit and charge cards accounted for the remaining 42.6% share.

Nikhil Reddy, Payments Senior Analyst at GlobalData, comments: “The economic slowdown and the travel restrictions amid the COVID-19 pandemic forced individuals to spend prudently, which resulted in the reduced use of payment cards in the short-term.

“With several of the COVID-19 restrictions now eased and consumer spending on rise, both debit and credit card use is expected to increase.”

GlobalData’s Payment Cards Analytics reveals that the value of debit card payments is set to register a CAGR of 14.5% between 2021 and 2024 while credit and charge cards will grow at a CAGR of 16.6% during the same period.

The government, in collaboration with card issuers and schemes, is also taking various measures to support card market. One such initiative was the removal of interest rate upper and lower cap from 1 January 2021, which was previously set between 12.78% to 18.25%, respectively. This means the interest rate can now be determined by the issuer and card holder through independent negotiation between them. This initiative will drive competition in credit card space thereby could result in lowering costs for cardholders.

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In addition, the entry of international card companies will drive competition in the Chinese card payment market, which has been predominantly dominated by domestic card giant, China UnionPay. American Express became the first foreign card company to receive approval to establish a network to clear card payments in China in June 2020.

American Express partnered with several banks including CGB, Shanghai Pudong Development Bank, Minsheng Bank, Ping An Bank, China Merchants Bank, and Ningbo Bank, for issuance of single-label American Express cards in China. It has also collaborated with over 14 million merchants for acceptance of these cards across the country.

Mr Reddy concludes: “China is the largest payment card market. Although growth was hampered in 2020, the revival of economy along with rise in consumer spending, government initiatives to promote card payments, and entry of foreign card schemes will help bring it back to growth trajectory over the next few years.”