Cross-border payment industry barriers and market evolution and e-commerce platform governance development history
Cross-border payment industry barriers
Compliance Barriers
Cross-border payment companies need to hold corresponding payment licenses in the countries where they operate and be familiar with local financial regulations. In addition, it is also necessary to ensure that the system can support global expansion and complete compliance, risk control, anti-terrorism and anti-money laundering work.
Core technical barriers
Cross-border payments have extremely high requirements on system stability, security and risk control. Therefore, companies need to have the development technology for core and supporting value-added service applications, and continue to develop and innovate to meet market demand.
Industry entry barriers
To operate cross-border payment business, you need to obtain the “Payment Business License” from the People’s Bank of China and the cross-border foreign exchange payment license approved by the State Administration of Foreign Exchange.
Financial barriers
A payment license needs to meet the minimum registered capital of 100 million yuan. The payment industry has significant economies of scale, and only when the transaction volume reaches a certain scale can it achieve breakeven. With the rapid development of payment institutions’ business, customers’ requirements for fund settlement efficiency have further increased their demand for funds.
Brand barriers
Payment services involve financial security, so a good brand and reputation are often important considerations when users choose a payment service provider.
The development and evolution of the cross-border payment market
Cross-border payment 1.0
Foreign-funded payment companies dominate the cross-border payment market, characterized by high payment service rates of 2-3%. Companies dominate the market and sellers have no choice.
Cross-border payment 2.0
The rise of domestic cross-border payment companies, the typical representative is Lianlian Payment, is characterized by a 1% rate, which lowers the industry rate level, and the payment license sets industry entry barriers.
Cross-border payment 3.0
Domestic cross-border payment has entered a flourishing era, characterized by further reduction of rates to 0.5-0.7%, focusing on brand building, providing differentiated value-added services, and a collection + software service system.
Cross-border payment 4.0
Enter the seller’s value chain, provide more value-based services, and make cross-border business more efficient and simpler. The characteristic is that the added value of services has become the key to the company’s success, creating a comprehensive cross-border e-commerce service platform.
The development history of e-commerce platform governance
In the early stages of e-commerce platform development, the platform mainly focused on attracting investment and attracting traffic, and the logistics process was completed by third-party freight forwarders. As e-commerce platforms grow and mature, in order to enhance the controllability of logistics links, e-commerce platforms have begun to build cross-border logistics systems, conduct in-depth cooperation with postal, customs, taxation and other departments of various countries, and gradually share services.
By optimizing and deeply integrating logistics operations, e-commerce platforms have strengthened their control over the entire logistics process, thereby better ensuring consumers’ shopping experience. This is also an important part of e-commerce platform governance.
Conclusion
Both the cross-border payment industry and e-commerce platform governance are constantly developing and improving. In the future, with the advancement of technology and changes in the market, these fields will usher in more new challenges and opportunities.