International

China’s Quest To Prompt More Cross-Border eCommerce

The Chinese government released on Saturday (June 20) a series of guidelines to support cross-border eCommerce, its new pet project. China-based eCommerce companies will be handed state support on international projects and credit insurance services, according to various reports. According to Reuters, the government’s support will include:

  • Tax policies and pilot projects to ease overseas payments
  • Streamlining clearance of goods by customs
  • Possible collective declaration during quality supervision by agencies
  • Examination and release of goods
  • Tax sweeteners on eCommerce retail exports
  • Promotion of yuan in settlement of payments

This move is the latest initiative in a series launched by China to strengthen both the competitiveness and the development of eCommerce. Last week (June 19), the Ministry of Industry and Information Technology stated that it will allow foreign ownership of some eCommerce businesses, a move that Reuters said would encourage foreign investment in the industry.

These initiatives will feed on China’s recently launched New Silk Road Initiative, coined “One Belt, One Road” to increase political and economic cooperation with its neighboring countries. This will translate into the creation of economic corridors and $900 billion of investment along the route.

In this context, China’s cross-border eCommerce trade is projected to reach 6.5 trillion yuan ($1.1 trillion) in 2016 – up from 2.3 trillion yuan in 2012, according to a recent report by iResearch. Currently, the big winners of China’s booming eCommerce are undoubtedly marketplace giants such as Alibaba and its online option Alipay or Chinese rival JD.com. Alibaba CEO Jack Ma wants to reap the benefits of China’s new initiatives, which is why he is currently busy talking to the U.S. and opening offices in Russia.

In China, the rise of eCommerce is partly due to a growing middle class which enjoys increasing purchasing power. In his trip to the U.S., Ma said: “Today, China’s middle class is equal in size to the entire U.S. population and is expected to double within seven years.”

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New PYMNTS Report: Preventing Financial Crimes Playbook – July 2020 

Call it the great tug-of-war. Fraudsters are teaming up to form elaborate rings that work in sync to launch account takeovers. Chris Tremont, EVP at Radius Bank, tells PYMNTS that financial institutions (FIs) can beat such highly organized fraudsters at their own game. In the July 2020 Preventing Financial Crimes Playbook, Tremont lays out how.

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