[photopress:China_credit_card.jpg,full,alignright]China Market Research Group has a report that suggests a new breed of younger, more affluent consumers will drive e-commerce in China.
Many analysts argue that Chinese consumers are conservative spenders and not willing to buy on credit or engage in e-commerce. China’s household savings sit at 40% which compares very with less than 1% in the U.S. Credit-card penetration in China is low, with fewer than 50 million cards in circulation for an emerging middle class of 250 million.
Sales are now being led by a younger generation that is willing to buy on credit and shop online. In surveys and interviews that the China Market Research Group (CMR) conducted with Chinese youth between the ages of 18 and 28 in Shanghai, Beijing, and Guangzhou, more than 80% said they were willing to buy items online and over 70% said they would use a credit card if they could.
The surveys suggests Chinese between the ages of 18 and 28 save very little or actually buy on credit because they are so optimistic about China’s economy and their own earnings potential.
Last year, the total value of all online transactions, both business and consumer, soared to $127.5 billion, up from $85 billion in 2005. The consumer side represented a fairly small portion of this amount. As more credit cards are adopted, then e-commerce will continue to grow.
Source: Seeking Alpha