The debut of foreign banksï¿½ internet services came six years after China Merchants Bank first introduced an internet-based payment system in 1997. The bank had attracted 1.4m internet-based customers by late 2001. Meanwhle the Industrial and Commercial Bank of China, which began offering individual internet banking services in 2000, announced that its monthly internet banking turnover exceeded Yn500bn for the first time in September 2002 ï¿½ a level eight times greater than the same month in 2001.
ICBC, China's largest commercial bank, signed an agreement with Microsoft in February 2003 as part of its plan to launch a new generation of personal internet banking services in July.
But hopes for cyber-banking making an impact in the retail market ultimately depend on the popularity of the internet among consumers. Here, at least, there are grounds for optimism.
The number of internet users in China surged to 59.1m by the end of 2002 ï¿½ a rise of more than 75 per cent on the previous year, according to the China Internet Network Information Centre. This represented just over 4.6 per cent of the total population. In Shanghai and Beijing about 30 per cent of the population go online for at least one hour each week, the survey found. There are substantial geographical differences (see map on page 16), with the major coastal cities accounting for a high proportion of the national total of internet users.
In contrast, a 2002 report by market research firm AC Nielsen found that China had just 2.6m users of internet banking services. Internet banking would indeed have a bright future in China's cities if it came close to following the trends set in Singapore and Hong Kong, where more than half of internet users have online accounts. With an overwhelming 93 per cent of current internet users in China expressing a positive view of online banking services, this prospect may not be too far-fetched.