This is largely part of an international phenomenon, although the size of the potential market makes China a particular draw. Although Internet penetration remains small judged on a per capita basis, statistics suggest a large and growing community of Internet users in China. However, the growth of e-commerce in China faces a number of practical and regulatory challenges. At a practical level, Chinese consumers typically prefer to transact in cash or debit cards, and the rate of use of credit cards is low.
Chinese consumers are also concerned about the security of e-commerce transactions.
Internet access costs are high compared with average personal incomes. China's telecommunications infrastructure also needs to be upgraded in order to provide Chinese users with reliable high-speed access to the Internet. Delivery costs, due both to the use of courier services and China's distribution infrastructure, also impede the development of China's e-commerce sector. The Chinese government also views the Internet with some suspicion. A number of agencies regard it as an uncontrollable source of foreign influence and of information that may be harmful to the State.