Novatti signs deal to support WeChat Wallet financial transactions for Chinese consumers in Australia
September 6th, 2016
Novatti Group Limited (ASX: NOV, “Novatti” or the “Company”) has signed an agreement with RoyalPay Australia, the first Australian distributor for WeChat Wallet, following the commencement of commercial operations in Australia for Novatti’s Trusted Party Services business.
This is the first deal for Novatti’s Trusted Party Services business, which was launched after a successful two-month trial, providing the Company with a new and immediate source of recurring revenue.
Under the agreement, RoyalPay (who is owned by Tunnel Show Pty Ltd) has become an authorised representative of Novatti subsidiary Flexewallet Pty Ltd and will be able to operate in this country under Flexewallet’s Australian Financial Services License (AFSL).
Novatti will receive a monthly fee as well as a commission for each transaction made using WeChat Wallet in Australia. The revenues will be dependent on the take-up of the service.
WeChat Wallet is the mobile wallet service provided by WeChat, China’s largest social media messaging service with more than 700 million registered users. According to BI Intelligence1 more than one-in-two mainland Chinese use WeChat and around 93% of the population living in tier one cities are registered users of the app.
Chinese consumers cannot always use their bank and credit cards or prefer not to in Australia. WeChat Wallet provides one of the easiest and quickest ways for these consumers to make purchases in Australia via electronic payment (e-payments).
Chinese tourists make up the largest segment of Australia’s inbound tourism market, and an estimated one million Chinese visitors are expected to visit this country in 2016.
Furthermore, these tourists are forecast to spend $2.5 billion on retail goods while in Australia according to a report by Cross Border Management2.
Thousands of Australian retailers are expected to accept WeChat Wallet in the coming year, according to RoyalPay. Currently, over 100 local merchants are on the mobile payment system.
“The spending power of the booming Chinese tourist segment in Australia is huge, and we have helped enable a major new payment method for them,” said Peter Cook, Chief Executive Officer of Novatti.
“This deal further demonstrates that Novatti is quickly establishing itself as a leader in the global payments industry and we are expecting to finalise new commercial agreements with other global giants in the near future.”
WeChat is owned by Tencent Holdings Limited, a Hong-Kong listed Internet and mobile services group with a market capitalisation of around HK$1.9 trillion ($320 billion).
RoyalPay is an Australian company that provides smart and advanced IT solutions for the finance industry, including funds and transactions management.