American online payment service provider Paypal said it will help establish an international e-commerce hub in southwestern China to cash in on the nation’s fast-growing Internet sales market.
Paypal signed a deal with the government of Chongqing to jointly develop a foreign exchange settlement platform in Chongqing city, a popular investment destination for foreign companies desiring to establish operations away from coastal regions.
The deal will enable users to pay for cross-border online shopping transactions.
Paypal, which is a subsidiary of eBay, and the government of Chongqing agreed to set up five international e-commerce centres over the next few months for verification, investment promotion, national telesales, merchant training and regional business development.
Huang Qifan, mayor of Chongqing said the deal with Paypal will help Chongqing become China's settlement centre for international e-commerce as rising wages and a labour shortage have escalated costs in coastal regions.
“It will also contribute to the development of Chongqing into the financial services centre of west China,” he said in a statement.
For the first nine months of the year, China’s transaction volume in online payment market totaled 725.5 billion yuan ($109.5 billion) boosted by the booming e-commerce market, according to Analysys International.
The Beijing-based research company said it expects value of online payments to hit one trillion yuan for the full year.
PayPal has more than 84 million active users around the world and allows payment in 24 currencies.
Alipay, a unit of China's largest e-commerce company Alibaba Group that owns online auction site Taobao.com dominates the Chinese online payment market with a share of 50.5 percent, according to Analysys.