Banking turns to online malls

Banks take transactions to virtual malls.Major Chinese mainland commercial banks are trying to increase credit card usage by running online shopping malls, under familiar names like e-shop, Egou and Tesco.
The popular purchases range from mobile phones and other digital products to household electrical appliances, jewellery, cosmetics, garments, shoes and headgear. The list goes on.
Most banks have adjusted their caps for single online transactions online or daily accumulated debits downward, so this move has made it difficult for big ticket items to be purchased online.
However, this has also created opportunities for hire purchase arrangements in banks' online stores. Payment by instalment suits the needs of middle income shoppers going after luxury goods, stimulating spending.
For instance, many people find it expensive to land a branded handbag with a price tag of Rmb10,000, but they're more willing to buy if payment is made by monthly instalments of, say, between Rmb700 and Rmb800.
Many consumers hold high hopes for these bank-related online stores. Many reckon that, compared with normal online stores, products and services provided by banks offer better assurances. Once any problems occur, they can resolve them with the banks, they believe.
Under such circumstances, banks are at an advantage when it comes to online shopping. Their official websites are ideal promotion platforms, with high click rates. They also have a higher degree of trust among consumers.
All these factors have contributed to the rapid growth of online bank-related malls. Where luxury goods are concerned, banks are expected to do outstanding business.
However, banks claim they are not the vendor in these transactions but just the payment service provider. In other words, should any problems arise concerning product quality, price and usage the shopper has to settle the matter through sometimes lengthy negotiations with the supplier.
The same applies to disputes that crop up concerning late delivery, non-delivery, goods replacements or return of goods.
from Cherry Chen, Shanghai Office