The impact of third-party payment on online banking and SMEs in China

In the recent past, China has undergone rapid developments that have impacted various sectors of its economy. Various technological innovations have led to the emergence and progress of TPP platforms that significantly affect conventional payment operations. In this study, the author aimed at establishing the impact of these TPP platforms on SMEs and online banking. The study also aimed at showing the current and future risks towards SMEs from TPP platforms and the Chinese regulatory framework governing TPP activities. The study used Alipay, the largest TPP platform in China, to attain its study objectives. The study used a mixed-method approach where the author analysed qualitative and quantitative data from the sample. The study had a sample of 261 people that utilise online banking and SMEs goods and services via TPP platforms. The modified motivation theory of information technology guided the study. The study established that TPP platforms influence online banking by lowering its incomes and increasing competition to acquire customers who want money transfer services. The study further demonstrated that most SMEs have begun to TPP platforms because they increase their access to various customers and increase cooperation with other business entities, including banks and TPP organizations. The study further established that market, credit, policy, regulation, and safety regulations are the main risks that discourage consumers from utilising TPP platforms. The research findings implicate the Chinese administration to establish a sophisticated legal framework to help govern TPP platforms operations, including registration of users and protection and sharing of user information