Third-Party Payment in China: 99Bill, Hot Out of the Gates, but Sustainable?

Publication Date	December 2007
Publisher	Maverick China Research
Product Type	Report
Pages	25
ISBN Number	not applicable
Product Code	MAV00019

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Summary

99Bill, one of China's newest players in online payments, is also one of the fastest growing ones. 99Bill aggressively markets its services to end users, in contrast to competitors such as IPS and Chinapay, which target merchants instead. 99Bill claims one of the largest user bases among China's third-party payment providers today. However, despite the company's fast-growing user base, 99Bill's bottom line, like most of its competitors, is still in the red. In this report, we detail 99Bill's growth strategy, services, and partnerships, and analyze whether 99Bill's aggressive user acquisition strategy is sustainable in China's payments sector.

Content

1 Industry Overview: Key Factors Shaping Third-Party Payments in China
- 1.1 Continued preference for cash payments, but bank card payments rising
- 1.2 Credit card use remains low; debit cards widespread
- 1.3 Limited coverage of non-cash payment services
- 1.4 China UnionPay's bank card monopoly
- 1.5 Quasi-online payment systems an interim solution
- 1.6 Two ISPs, 162 million Internet users
- 1.7 Two mobile operators, 514 million subscribers
- 1.8 Contactless smartcard use increasing but largely limited to buses and subways
- 1.9 Government regulations and the ""national interest""
2 99Bill - Hot Out of the Gates, but Sustainable?
- 2.1 Company Overview
  - 2.1.1 Ownership
  - 2.1.2 Organizational Structure
  - 2.1.3 Management Team
- 2.2 Business Performance
  - 2.2.1 Users
  - 2.2.2 Financial Performance
- 2.3 Services and Channels
  - 2.3.1 Online Payment
  - 2.3.2 Business Model and Fee Structure
- 2.4 Markets and Coverage
  - 2.4.1 User Demographics
- 2.5 Marketing and Branding
- 2.6 Partners
  - 2.6.1 Bank Partners
  - 2.6.2 Merchant Partners
  - 2.6.3 Technology Partners
- 2.7 Competitive Analysis
  - 2.7.1 Strengths
  - 2.7.2 Weaknesses
- 2.8 Outlook
List of Figures
- Figure 1: Credit cards issued in China and in the US (M)
- Figure 2: Internet Users in China, 2001-2006 (M)
- Figure 3: Mobile Subscribers in China, 2002-2010F (M)
- Figure 4: China government groups involved in third-party payment regulation
- Figure 5: 99Bill Registered Users, 2005-2007 (M)
- Figure 6: 99Bill Quarterly Transaction Volume, 3Q 2006-3Q 2007 (RMB M)
- Figure 7: 99Bill Direct Debit Operation Model
- Figure 8: 99Bill Payment Methods
- Figure 9: 99Bill User Fee Structure
- Figure 10: 99Bill Merchant Fee Structure
- Figure 11: 99Bill Foreign Currency Payment Deposits
- Figure 12: 99Bill Security Device
- Figure 13: 99Bill Payment Service Coverage by Channel
- Figure 14: 99Bill Logo
- Figure 15: 99Bill Bank Partners
- Figure 16: Select 99Bill Merchant Partners