The Silicon Review ^Asia

PayPal will enter the Chinese digital payments market with the acquisition of majority equity interest in GoPay, Reuters reported on Monday. The American company becomes the first licensed firm to enter the digital payments services market of China.

The entry of PayPal comes at a time amid trade tussle between the US and China. The permission to acquire 70 percent of controlling stakes of GoPaywas given by China’s central bank to PayPal.

It is learnt from a statement by GoPay that it has a permit for mobile, online, and cross- border Yuan payment services.

The financial terms of the deal were not revealed by any of the companies and are expected to be closed by Q4 of 2019, a PayPal official said. A Reuters report says that a subsidiary in Shanghai will help PayPal to carry out the acquisition.

The functioning of the GoPay platform is similar to PayPal. It paves the way for merchants to accept non-credit card payments directly from their websites.

Previously, only one other American company entered the Chinese market. In 2018, American Express was given preliminary clearance from the People's Bank of China to start establish a network based on clearance and network through its joint venture with Chinese partner LianLian group.