Global payment service firms are eyeing huge growth opportunities as a record number of Chinese students are planning to go abroad for higher studies, an industry report said.
China has been the largest overseas student source country for four consecutive years, said the report published by UnionPay International Co Ltd, the international business arm of China UnionPay. It said the number of overseas students from China rose by 12 percent year-on-year during the past five years, and reached 460,000 by the end of last year.
Tuition fees, accommodation, travel, and daily consumption needs of this group may reach up to 500,000 yuan ($80,645) a year.
"Most of the students choose destinations in the United States, the United Kingdom, Canada, Australia, Germany, Japan and South Korea and about 50 percent of the Chinese overseas students seek admissions in the top 100 global universities," the report said.
An emerging trend among overseas students is that pupils and middle school students account for a larger portion than before, with more parents choosing to send children abroad for education at a younger age.
In New Zealand alone, the number of Chinese students studying in the country surged by 85 percent year-on-year in 2014, according to a report by Beijing Times.
About 60 percent of the young students' parents are willing to pay more than 800,000 yuan for their children's overseas education, and only 6 percent of the parents among this group are cost-sensitive.
UnionPay International said it helps students to pay tuition and other fees in 1,200 schools, colleges and universities around the globe. Several domestic banks have also introduced bankcard products targeting Chinese students studying overseas, allowing parents and students to make online payments through money transfer networks such as peerTransfer and Western Union.
"In the future we may introduce more solutions for overseas students' payment for accommodation," said Cai Jianbo, chief executive officer of UnionPay International.
Since more than 90 percent of China's overseas students are self-funded, demand for payment services such as transactions of tuition fees and other expenses is rising, driving market players to join the competition in this area and develop more solutions for students and parents.
In 2014, International Student Identity Card Association launched ISIC MasterCard targeting Chinese students going abroad. The card product is expected to see issuances of about 100,000 by the end of this year, according to Wang Junfeng, president of Transforex (Hong Kong) Investment Consulting Co Ltd.
Most of the students traced by the company said they hold more than one card and use both online and offline channels to pay for their expenses abroad.
"Unlike my father who used to study in Japan in the 1990s and who used to carry cash by sewing it into the inner layer of his garments, I now use three bankcards, two Chinese banks and one local lender, to handle day-to-day consumption. My tuition fees are wired online to the school directly," said Xu Yixiang, 14, a student from Chengdu studying in Los Angeles.
