Digital wallets, led by Alipay and WeChat Pay, accounted for nearly 83% of China's e-commerce transaction value in 2021, up by more than 10% over 2020, according to The Global Payment Report 2022 of Worldpay – a payment processing subsidiary of Fidelity National Information Services, a U.S. leading provider of financial technology solutions.

Growing by 12% annually, China's e-commerce is expected to have a market size of over $3.2 trillion by 2025.

In contrast, digital wallets made up nearly half of e-commerce transaction value globally last year and are projected to rise to 52.5% in 2025. E-commerce is expected to account for 12% of global consumer expenditures by 2025, with 59% of e-commerce expenses transacting via mobile devices, said the report.

Philip Shi, Worldpay's country manager in China, noted that unlike any other e-commerce market globally, China is dominated by online markets, super-apps, and mini-programs, driving the adoption of mobile wallets and other digital payments by consumers. 

Digital wallets also figure prominently in China's point of sale (POS) transaction, comprising 54% of the country's POS transaction value last year, primarily via QR codes. It is projected that the proportion will reach nearly two-thirds by 2025, presenting over $17 trillion. Cash will fall below 10% of POS transaction value in China in 2022.

Worldwide, mobile wallets' share in POS transactions jumped over 21% year-on-year in 2021 to 28.6%, or over $13.3 trillion. 

China is at the forefront of payment innovation. According to Philip Shi, as the country is ramping up research and pilot use of digital yuan, digital currency is expected to be widely used as another form of currency. 

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