![]() This is part of a larger thesis on Super Apps that I’ll talk about in my next post. In my last post, I proposed that WeChat began morphing into a true “Super App” at the point where it added official accounts (a pre-cursor for mini-programs) in May of 2013. In that same update (WeChat Version 5.0) WeChat added payments and the ability to buy stickers (one of their first monetization attempts). #Tencent wechat ecny wechat pay 800m update# In Q4 2019, WeChat pay was doing more than 1 billion commercial transactions/day across its 800 million monthly active users and 50 million merchants. One way to think about WeChat mini-programs and their apps is that they’re storefronts built on top of a payment app, rather than a payment experience build into a website. It’s actually a bit fuzzy where Tencent makes money on WeChat Pay. They don’t break out payments from “FinTech” and “business services” in their financial statements, but I am going to imagine they have a set up like Apple Wallet where they take a small fee on transactions (e.g., 0.15%) that otherwise would have gone to the banks/card issuers. Six years later, in 2019, FinTech offerings drove $11.9 billion (22% of) Tencent’s total revenue. ![]() WalkTheChat estimates what the WeChat Pay growth looks like over time:īesides the QR code payments that WeChat is well known for, they also offer FinTech products that include wealth management, consumer lending, insurance, and remittances, among many others. #Tencent wechat ecny wechat pay 800m code# To illustrate how big the Chinese FinTech market is, look no further than WeChat Pay’s most direct competitor, AliPay by Ant Financial (Alibaba). AliPay launched the Tianhong Yu’e Bao Money Market Fund (which basically amounted to a high-yield checking account) for users in 2013 and by 2017, it was the largest money market fund in the world, surpassing offerings from JP Morgan, Fidelity, and Vanguard. By March 2019, the Tianhong Yu’e Bao fund (which translates to “leftover treasure”) had about 588 million clients, 1/3 of the Chinese population. ![]() In the fall of 2018, Tencent and WeChat launched their own similar product, LingQianTong (or “Mini Fund”). As of November 2019, it looks like WeChat’s product was managing about $112 billion and has been competing against AliPay’s product by offering higher interest rates. One of the biggest contributions that WeChat Pay (and AliPay – but this issue isn’t about them!) has made has been bringing an entire country online to digital payments. China is the country with the highest rate of digital payments and its thanks to these two companies. WeChat Pay also has a deep integration with “WeBank”, one of China’s first ‘neobanks’. WeBank could be the topic of another issue, but TL/DR is that WeBank is a Chinese neobank whose core revenue driver is acting as a broker connecting banks (lenders) with consumers and small businesses (borrowers) and taking a fee in the middle. #Tencent wechat ecny wechat pay 800m driver# WeBank’s largest shareholder is Tencent (~30%) and I believe the only reason Tencent doesn’t own more is due to some regulation around ownership levels of banks. Like most countries, China has restrictions on banking licenses and consumer deposits. WeChat Pay (which is not a bank) has limits about how much you are able to transact annually (I believe ~30,000 USD), but once you hit that limit, WeChat recommends you to set-up an account with WeBank. In part one, I shared the crystal-ball like quote from Pony Ma:īefore starting TalkBox, Heatherm Huang recalls seeing Pony Ma speak at a conference. Pony Ma shared that even though he had built China’s most successful messaging app (QQ), he was paranoid that his empire could still be destroyed. He hoped that if something was going to kill QQ that it be built by Tencent. “If something is going to beat our product, I want it to be built here.” I’ve heard versions of that sentiment ascribed to Mark Zuckerberg, as well. I’m reading the book No Filter about the history of Instagram right now and it’s clear that Mark Zuckerberg doesn’t actually mean that quote when he says it. He was very aware that Instagram was taking screentime away from Facebook and he did not like that. Pony Ma of Tencent, on the other hand, showed that he meant this quote when he began taking resources away from Tencent’s very successful desktop messaging app QQ and investing all of Tencent’s vast resources behind WeChat. #Tencent wechat ecny wechat pay 800m code#.#Tencent wechat ecny wechat pay 800m driver#.#Tencent wechat ecny wechat pay 800m update#.
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