The return of Chinese students to Australia is great news for Novatti
The recent news that Chinese students will soon be returning to Australia is positive news for Novatti’s Cross Border Payments business, which enables people to make payments in and out of Australia.
Digital payment products within this division are well established and highly scalable having built the underlying payments network that facilitate cross border payments, backed by Novatti’s focus on technology, operations and processes to meet Australia’s high governance and compliance standards.
ChinaPayments, for example, is one of Novatti’s established businesses that addresses cross border payments. The business is seeing an increase in Gross Transaction Volume (GTV) since the China Ministry of Education released an edict declaring that international university degrees obtained by remote learning will not be recognised, forcing their return to countries like Australia.
For example, In the first 10 days of February 2023, ChinaPayments processed $3.88 million in GTV (unaudited). This was a 50% increase on the corresponding days in February 2022.
The ChinaPayments business has built a range of digital payment offerings that leverage competitive FX rates and mobile payments offered through Novatti, enabling migrants to make digital RMB payments via popular electronic wallets such as Alipay, WeChat Pay or UnionPay. Recipients in Australia such as universities, housing providers and utility companies are then paid in Australian Dollars.
Novatti teams have been out in force at University O-Weeks promoting these services to capitalise on international students returning to Australian campuses in response to the edict.
While China forms a large portion of the global education segment, Novatti has intentions to scale the ChinaPayments technology into other countries in 2023.
Australia’s net migration is now forecast to exceed 300,000 arrivals in 2023, a 25% increase on previous Treasury forecasts. These are strong tailwinds that Novatti can capitalise on and one strategy includes expanding the ChinaPayments model under a Novatti BillPay offering into other international wallets and currencies from nations including Indonesia, Philippines, South Korea, Thailand and Malaysia. Doing so will leverage the existing partnerships Novatti has in the education sector and provide the same seamless customer experience that is valued by ChinaPayments customers.
This increased currency flow will tie back into Novatti’s Gross Transaction Value (GTV) with quarterly GTV exceeding $1 billion in the December quarter for the first time.
Novatti’s Managing Director Peter Cook said, “The team at Novatti have a busy year ahead which will include launching Novatti BillPay and marketing the payment solutions at various events. The team will also continue to work closely with their Alipay, WeChat Pay and UnionPay partners to boost awareness amongst businesses who can offer this payment option alongside students and their benefits who are seeking a local Chinese or Asian currency payment option. We are confident that increasing its addressable market by scaling up as Novatti BillPay in non-China markets, the business will contribute to generate greater GTV for Novatti going forward.”
Disclosure: At the time of writing, Australian FinTech Pty Ltd is a shareholder of Novatti Group Limited.
