Technology
Pressure on China’s tech giants highlights need for right fintech partners
Published by Jessica Weisman-Pitts
Posted on November 18, 2021
5 min readLast updated: January 28, 2026
Global Banking & Finance Review®
Company
Published by Jessica Weisman-Pitts
Posted on November 18, 2021
5 min readLast updated: January 28, 2026
Choosing the right fintech partner is vital for companies entering China's market due to complex regulations and a booming e-commerce sector.
By David Messenger, CEO of cross-border payments company LianLian Global
It is more important than ever that companies that want to expand into China find the right cross-border payments partner. Compliance with complex and fast-changing Chinese regulations requires a great deal of precision and approvals, and yet some companies still lack the necessary licenses and know-how. The right cross-border payments guide and partner can help market entrants to stay safe and prosper, whether they are trying to move money into or out of China. David Messenger, CEO of cross-border payments company LianLian Global, explains how by making the right choices, international companies can accelerate their success in the Chinese market.
China’s continuing e-commerce boom
E-commerce with China is booming. The volume of cross-border e-commerce sales in China will be approximately 6 trillion yuan (US$ 920 million) in 2021, according to market research firm iResearch, having doubled over the previous five years. Three main drivers are China’s fast-growing middle-class, the extraordinary supply chain of goods emanating from China, and the large volume of e-commerce sellers providing goods to consumers all over the world. As a result there is an amazing opportunity to support sellers with e-commerce services, tap the supply chain opportunities and sell into China.
At the same time, there have been headlines about the impact of Chinese regulators rapidly developing and enforcing regulations about anti-competitive behaviour, data privacy and data security. This has even affected China’s high-profile tech giants, such as Ant Group and ride-hailing app Didi. The government has also focused on sectors like private tutoring (significantly restricting after-school tutoring) and the real estate sector (to ensure housing prices are stable and avoid excessive speculation) as it seeks to champion consumers and workers.
According to Yi Gang, China’s central bank governor, this is part of a wider policy by the government to tighten its grip on the economy. Speaking at a conference organized by the Bank for International Settlements, he recently said that China would: “continue to co-operate with anti-monopoly authorities to curb monopolies and actively deal with . . . new forms of anti-competition behaviour.”
It is now very clear that the Chinese government is prepared to act decisively even against the largest firms if those companies abuse their market position or fail to comply with regulations. Against such a fast-changing backdrop, it is critical for any company expanding its cross-border business in China to pick the right partner. Chinese regulations are complex and ever-changing. There are a lot of checks to complete, and yet some international payments companies do not even have a Chinese cross-border payments license or the necessary know-how.
That makes it absolutely essential to work with a partner that is reliable and understands how this fast-changing situation is likely to evolve. This is true of even the most tech-savvy companies. For example, Airbnb partnered with us when they realized that they needed a sophisticated partner to help them comply with quickly-changing, local Chinese regulations. That is because a cross-border payments business that straddles the border is uniquely positioned to help its customers to move funds into and out of the country.
Tackling the compliance challenge
If you are a non-Chinese company looking to expand your business with China, you will want to eliminate – or at least substantially reduce – risk on the compliance side. But that is hard. Take the example of KYC checks. These are difficult for foreign investors and businesses trying to operate in China for three main reasons:
In my experience, partnering with an established Chinese fintech company that has deep understanding of compliance in this dynamic regulatory environment is the best way to overcome these barriers. That way you can ensure that you mitigate your business’s exposure to risk.
How to choose a fintech partner
So what should you look for when choosing such a partner?
Support that goes beyond payments
Of course, when working with the right partner, companies can receive support that goes far beyond payments.
This support could come in the form of multicurrency accounts, logistics, marketing tools to grow the customer base, or perhaps working capital finance. In a competitive sector, smart payments companies are expanding their offering beyond their core product and as a result becoming even more useful to their customers.
So despite all the recent news, there is no doubt that cross-border e-commerce with China continues to represent a huge opportunity for many international companies. But to seize those opportunities successfully, it is essential to work with a fintech partner that really knows and – more importantly – understands both where China is today, and the future direction of travel.
The article discusses the importance of choosing the right fintech partner for companies expanding into China's market.
Compliance is crucial due to China's complex and rapidly changing regulations affecting foreign businesses.
The right partner helps navigate regulations, reduce compliance risks, and leverage China's e-commerce opportunities.
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