The number is about six times more than the sales during “Black Friday” and “Cyber Monday” combined. This result may be exciting for many merchants and e-commerce platforms in China, however, it was a big test for the processing power of the China Nets Union Clearing Corporation (Nets Union).
Nets Union, or 'Wanglian' in Chinese, is the system designed to remove the direct “bank – payment company” connection in China. Sitting between payment providers and banks, Wanglian is an internet payment clearing platform, similar to UnionPay, but for online transactions. Chinese regulators have mandated that all online transactions eventually have to go through Wanglian.
However, moving all the transactions onto a new platform is not as simple as moving houses. During Double 11, the daily online transaction volume can reach over 2.5 billion payment transactions. At the peak time, the platform needs to deal with nearly 200,000 transactions per second (TPS) which leaves little room for breakdown or mistakes.
At the moment, Wanglian has taken on only about 50% of Alipay and Wechat Pay transactions. These two payment giants count for 90% of the total online payment market in China. Even so, during the peak time of Double 11 festival, Wanglian had to deal with 92,000 transactions per second. Over the course of the whole day, Wanglian completed 1.1 billion transactions with a 100% success rate. It can be said that Wanglian passed its Double 11 test.
There are however more challenges ahead. By the end of 2018, 70% of Alipay and Wechat Pay transactions will move to Wanglian, and by March 2019, all of online transactions in China need to processed, which will be challenging as the online payment market continues to expand. Wanglian is also a joint stock company led by the state-owned financial institutions, with other third party payment companies as shareholders. Although it is government mandated, it was not created with a very solid business model in mind, which will be one of the challenges going forward. Big data products including credit scoring have been discussed as well as providing cloud services for other platforms.
It is clear that Wanglian will need to be the future of any online payments processed in China. What that future looks like however, is anyones guess.