China gears up for e-commerce boom
(CNN)
Updated: 2005-11-02 11:09

Just like the US tech boom of the 90s, China's Net entrepreneurs are young, smart and riding the crest of a wave.

China's tools of commerce: bank wire, postal wire, debit card, prepaid card, credit card and cold hard cash

Young, wired and hooked -- the country's online tribe is massive, and its members are itching to get their fix.

For e-commerce execs, this place looks like the mother lode, but there is just one hitch -- China has a notoriously fragmented banking system.

There are too many ways to pay, from online game cards, debit cards, international debit cards, local credit cards, bank wires, post wires, and last but not least, cash.

Oliver Kwan, CEO of 99bill.com is out to connect all the dots.

Kwan's company offers a fast, safe and streamlined way for Chinese Web users to pay online.

"I used one bank card to pay for one item. The payment took one week to settle. Then to mail in it took another 10 days. So it took 15 days before I could see the item. That was the old days; today it's getting better," he told CNN.

Today, an online payment through 99bill is processed immediately.

After one year in the business, Kwan's company is quickly gaining on rivals Alipay and Paypal China and already has about 1.6 million users.

Not bad, but still a drop in the bucket in the land of 100 million Internet users.

China's "Net-izens" venture online mainly for news and social interaction. And in the off-chance they make an impulse buy, they whip out the cash.

At online book retailer Dangdang.com, the majority of customers still pay using renminbi (meaning "people's currency") on delivery.

But it is early days -- Net users are warming up to the idea of online payment. And besides, most of them are students. When they mature, their online buying power will skyrocket.

And when it takes off, e-commerce will have a distinctly Chinese feel. Mobile technology will play a huge role. There are three times as many mobile users as Internet users in China.

Kwan's 99bill already offers payment through mobile phones, signaling that e-commerce in China is making significant progress.

And as for the transport of goods bought online -- most deliveries are still done by a guy on a bicycle. I guess another startup will have to handle that one.