During the first half of 2026, the performance of domestic payment institutions showed increasingly pronounced divergence, with cross-border operations emerging as a key growth driver. LIANLIAN saw its global payment revenue climb 27.1% year-on-year, while Ecofin Digital Payments Infrastructure Fund recorded a 46.38% surge in cross-border payment transaction value. Against a backdrop of regulators consistently steering the industry back to its core payment functions, companies are accelerating their global expansion plans, while AI agents have become the next widely anticipated frontier.

Wang Pengbo, chief analyst at Botong Consulting, noted on August 27 that the disclosed semi-annual reports reveal clear structural divergence within the payment sector. Cross-border operations offer incremental growth opportunities, but licensing barriers directly widen the profitability gap between institutions. Domestic acquiring businesses still rely primarily on transaction fees as their core revenue stream, and although cross-border and merchant value-added services are growing at a commendable pace, their limited share is insufficient to offset the downward pressure on gross margins in traditional operations. Combined with persistently rising compliance costs, the industry has moved past the stage of relying purely on scale to drive growth.

Robust Overseas Growth at Three Payment Firms

According to the report, LIANLIAN generated revenue of 880 million yuan in the first half of 2026, an 11.9% increase year-on-year. The company's adjusted operating profit reached 156 million yuan, up 147.3%, and it recorded a net profit of 10.94 million yuan for the period. Looking at the revenue structure, LIANLIAN's payment service revenue hit 707 million yuan, of which global payment business contributed 601 million yuan, a 27.1% increase. Value-added service revenue grew 83.2% to 164 million yuan. During this period, LIANLIAN's total payment volume (TPV) for global operations reached 249.9 billion yuan, up 25.9%, with global payment revenue of 601 million yuan and global payment gross profit of 426 million yuan, rising 23.8%.

Wang Pengbo believes that the Chinese companies going overseas which LIANLIAN serves are deepening their operational focus. They are no longer engaged in simple cross-border trade but are increasingly shifting toward localized operations abroad, naturally driving greater demand for cross-border fund flows and diverse payment solutions. LIANLIAN's financial report reveals a dual strategy: on one hand, it continues to acquire payment licenses in various regions to complete its global compliance network; on the other, it is expanding beyond traditional cross-border e-commerce scenarios into more trade and service-oriented sectors, while building localized operations, compliance, and risk control teams.

During the reporting period, Ecofin Digital Payments Infrastructure Fund posted operating revenue of 3.257 billion yuan, up 22.86% year-on-year, with net profit attributable to shareholders reaching 669 million yuan, a remarkable 191.67% increase. After excluding non-recurring gains and losses, net profit attributable to shareholders was 219 million yuan, up 50.28%. In the first half of the year, Ecofin Digital Payments Infrastructure Fund accelerated its global payment capabilities, with cross-border payment and foreign card transaction volumes maintaining strong growth momentum, increasing 46.38% and 81.57% year-on-year, respectively.

Ecofin Digital Payments Infrastructure Fund also saw record-breaking overseas metrics in the first half. Gross payment volume (GPV) for operations in Hong Kong, Macau, and overseas markets reached approximately 6 billion yuan, surging 293.8% year-on-year. The profit contribution to overall payment business continued to rise, and the company projects it will reach around 50% within the next three years. Although the current share remains modest, the 293.8% GPV growth rate and 43.5% overseas gross margin suggest a viable path to achieving this target. As non-cash payment penetration increases overseas and local fee rates and gross margins remain higher than in the domestic market, overseas operations are poised to become a significant pillar of future earnings growth.

China's payment industry has transitioned from rapid expansion to a phase of intense competition for existing market share. Intensifying domestic rivalry is pushing companies to look overseas, making cross-border payments a vital growth area. Data from the General Administration of Customs shows that China's total goods trade import and export value reached 25.47 trillion yuan in the first half of 2026, surpassing the 25 trillion yuan mark for the first time in a historical first-half period, up 16.9% year-on-year. In January 2026, the People's Bank of China's 2026 payment and settlement work conference called for promoting the high-quality development of the modern payment system, accelerating the construction of the RMB cross-border payment system, advancing cross-border payment interconnection, and fostering a diversified, multi-tiered cross-border payment ecosystem.

"The cross-border track is in a growth cycle, and gross margins in this segment are significantly higher than in domestic acquiring, which is why overall transaction volumes and revenues are moving upward. Institutions with their own clearing channel capabilities enjoy stronger earnings stability. In contrast, some institutions rely solely on external partner channels for cross-border business; even if revenues grow, profits are vulnerable to fluctuations in profit-sharing ratios and exchange rates, reflecting weaker control over their full business chain," Wang Pengbo explained.

Generally speaking, payment institutions going overseas typically follow one of two paths: one is to accompany Chinese enterprises abroad and provide services to them, and the other is to obtain local licenses and operate locally. In Wang's view, the model of following Chinese enterprises abroad requires less upfront capital investment for local infrastructure, offers shorter business implementation cycles, and can quickly build scale by leveraging existing domestic Chinese client bases. However, because this model is highly dependent on domestic companies expanding overseas, business growth becomes tied to their pace of internationalization. It struggles to penetrate local merchant communities, limits the institution's overall bargaining power, carries risks of high client concentration, and faces clear growth ceilings.

On the other hand, directly applying for local licenses for localized operations entails higher upfront costs and longer project timelines due to license applications and building local compliance teams. But precisely because of having local licenses, institutions can connect to local clearing networks, serve local merchants directly, effectively reduce transaction costs, and maintain control over the fund flow chain. This approach reduces the impact of volatility in any single client's business cycle and allows for the long-term construction of a complete, independent overseas business foundation.

"Looking at industry practice, most institutions prioritize the follow-the-client model to validate their market approach. Once business scale reaches a certain threshold, they then initiate local licensing strategies. This aligns with the overall industry characteristic of transitioning from rapid cross-border expansion to a period of operational consolidation," Wang noted.

Breaking Through

Among payment institutions that have disclosed their performance, many have recorded revenue growth. According to Ecofin Digital Payments Infrastructure Fund's 2026 interim results announcement, its business is divided into segments including payment and digital services, and fintech services. As the core business vehicle of Ecofin Digital Payments Infrastructure Fund, the operating status of Xunfu is indirectly reflected in the performance of these segments. The financial report shows that Ecofin Digital Payments Infrastructure Fund generated revenue of 1.126 billion Hong Kong dollars in the first half of 2026, a 17% increase year-on-year, primarily driven by higher turnover in its payment and digital services and financial solutions categories.

During the reporting period, Jialian Payment's acquiring and value-added services business achieved operating revenue of approximately 1.165 billion yuan, up 23.38% year-on-year. Its parent company, Xinguodu, saw a slight year-on-year decline in net profit attributable to shareholders, mainly due to a decline in gross margins caused by rising prices of upstream materials, particularly storage components, in the electronic payment equipment industry, as well as exchange rate losses from currency fluctuations during the period.

Yi Payment, the core digital financial services vehicle of Yiwu Commodity City, leverages its advantages in the Yiwu cross-border trade scenario. From January to June 2026, its cross-border payment business transaction volume exceeded 2.51 billion US dollars. Additionally, Rendong Holdings, the parent company of Helibao, achieved operating revenue of 430 million yuan in the first half, up 6.23%, with net profit attributable to shareholders reaching 51.5616 million yuan.

Wang Pengbo believes that for institutions whose core business is domestic bank card acquiring, traditional transaction fees remain their revenue foundation given their massive transaction volumes. However, gross margins in basic domestic acquiring channel operations continue to face pressure. Offline acquiring institutions show clear divergence, with some growing transaction volumes while others see year-on-year revenue declines. Overall, the offline acquiring transaction scale for listed companies is mildly recovering, thanks largely to some small and medium-sized payment institutions voluntarily or involuntarily exiting the bank card acquiring market, coupled with fee increases that have driven profit recovery for offline acquirers.

"Market concentration toward the top players is a definitive trend. Small and medium-sized payment institutions are not suited for direct competition with major players in the general acquiring track. In the cross-border space, limited capital and resources make it difficult for smaller institutions to build up a reserve of licenses across multiple countries and regions," Wang stated.

How can smaller institutions break through? Wang believes that in value-added services, small and medium-sized institutions cannot simply replicate the mature products of leading players, as the merchant client bases differ. They need to tailor solutions to the actual operating scenarios of the merchants they serve to avoid homogeneous competition.

"Vertical industries represent a more viable breakthrough path for small and medium-sized institutions," Wang said. If they have industrial shareholder resources, they can deeply cultivate specific industry tracks, address real needs such as split settlement, reconciliation, and fund flow within the industry chain, and thereby build their own business moats. However, all business expansion must strictly adhere to compliance bottom lines, as anti-money laundering and merchant management impose rigid costs. Institutions must fully absorb these pressures. For smaller institutions lacking inherent industrial resource endowments, the actual room for breakthrough will continue to narrow.

Scaling Back Low-Efficiency Scenarios

Meanwhile, some institutions have seen their domestic payment businesses contract, with LIANLIAN's adjustments serving as a representative example. In the domestic payment sector, LIANLIAN proactively optimized resource allocation in certain low-contribution transaction scenarios during the reporting period, leading to a decline in domestic payment transaction volume. In fact, in its 2025 annual results, LIANLIAN had already proposed strengthening the synergy between domestic payment capabilities and its global payment network, allocating more resources to high-value needs arising from the globalization of Chinese enterprises. The further optimization of some low-contribution transaction scenarios in the first half of 2026 can be seen as a continuation of this operational philosophy in business structure and resource allocation.

"This change is quite consistent with what we observe in the industry. This year, regulators have consistently emphasized that payment should return to its fundamentals, and compliance requirements have been tightening. Many payment institutions, especially internet payment firms, are adjusting their business channels and scenario layouts to align with regulatory guidance. Additionally, many large foreign trade enterprises are shifting their operational focus overseas, which correspondingly reduces domestic business demand. As a result, we see most institutions in the cross-border payment industry following user demand and restructuring, tilting resources toward global business and ensuring business synergy. It's fair to say that the volume-driven business in the domestic segment is losing its growth space," Wang Pengbo explained.

If globalization is the current growth engine for payment institutions, AI agents are being touted by many as the next key focus. In the first half, LIANLIAN extended its value-added services around scenarios like intelligent marketing agents, providing end-to-end support for Chinese enterprises' international expansion and operational efficiency. LIANLIAN also collaborated with Visa and UnionPay International on B2B agent commerce and global procurement agent payment scenarios, respectively, pushing AI further into real commercial transaction processes. As these businesses gradually scale, value-added services have become a significant engine for the company's revenue growth in the half.

Ecofin Digital Payments Infrastructure Fund is also accelerating the deep integration of AI into its business and management. During the reporting period, the company used AI to reshape its R&D paradigm, with AI coding adoption reaching 70%. AI agents were embedded into customer service workstations, increasing the one-time resolution rate for customer inquiries to 84.7%. The merchant acquisition platform introduced AI review and localized OCR capabilities, reducing merchant onboarding review time by approximately 75%.

Ecofin Digital Payments Infrastructure Fund's financial report shows that in its in-store e-commerce business, AI has further penetrated daily operations for merchants and influencers, improving efficiency in content production, operations management, and customer service through AI tools, thereby driving simultaneous growth in business scale and profitability. In the first half of 2026, in-store e-commerce GMV grew over 75% year-on-year. Meanwhile, AI virtual employees optimized service processes and reduced costs, lifting segment gross margins above 70%.

Jialian Payment has launched an "AI Jia" intelligent assistant covering AI customer service, AI application intake, and AI daily business reports. For back-office operations, Jialian has built a one-stop intelligent agent management platform, creating multiple specialized agents for risk control, data, and compliance scenarios. Additionally, Rendong Holdings acquired Qingyuan Zhizhi in August of this year, entering the vertical industry agent infrastructure track and connecting the AI infrastructure, hardware, and scenario application chain to advance its "Payment + AI" strategy.

Wang Pengbo commented that in the broader industry context, agent commerce brings new payment demands. This strategic layout is supported by realistic business scenarios and objectively has strong development potential. However, the extent to which it materializes will depend on the actual progress of commercial product implementation going forward.