Despite the cooling economy, Chinese consumers aren’t holding back when it comes to holiday shopping. Domestic third-party payment platforms reported robust growth in transaction number and value during China’s week-long National Day holiday.
Why it matters: China’s economy has been growing at the slowest pace in nearly 30 years amid ongoing trade war with the US. The surge in consumer spending provided a much-needed boost to the economy.
- In the lead up to the Golden Week holiday which runs from October 1 to 7, the Chinese government unveiled several measures to spur domestic consumption.
Details: China’s major third-party payment platforms recorded a surge in transactions during the National Day holiday.
- China’s centralized online payment clearinghouse NetsUnion Clearing Corporation reported that the number of daily transactions increased nearly 80% year on year during the holiday, while daily transaction value increased 163% from the previous year, according to state-owned media outlet Xinhua. NetsUnion processed RMB 4.33 trillion ($607.2 billion) in 8.594 billion transactions over the holiday.
- Ant Financial said that average total spend per user grew 15% to around RMB 2,500 over the holiday. Overseas transactions on Alipay app rose compared with the same period last year, with Europe and Southeast Asia seeing the fastest growth. Japan and Thailand were the top destinations for Chinese tourists by transaction volume.
- WeChat Pay reported a similar trend, naming Japan as the top destination for Chinese tourists. The number of transactions (in Chinese) processed on a single day by merchants including grocery and fresh produce sellers, restaurants, cab drivers, and convenience stores rose as much as 30% during the holiday period.
Context: China has been planning efforts to boost consumption.
- In August, the government announced a plan to boost disposable income this year and the next with the aim to spur consumption. It also said previously that it would roll out other measures such as extending retail hours.
- According to China’s Ministry of Commerce, the revenue from retail and dining during this year’s holiday rose 8.5% from a year earlier to RMB 1.52 trillion, decelerating from the 9.5% seen in the same period in 2018.