消费者使用AirPayApp进行广泛的在线交易，如购买娱乐活动和交通的门票、订餐、购买保险产品、支付水电费、手机充值、购买或充值预付游戏点数，以及获取线下产品和服务的优惠券和促销代码。

AirPay competes primarily with credit card and debit card service providers, banks with payment processing offerings, other offline payment options and other electronic payment system operators. AirPay competes with these companies primarily on the basis of transaction processing speed, convenience, network size, accessibility, reliability and price. We believe the combination of AirPay’s numerous physical service counters and the AirPay App is a significant competitive advantage because of the strong demand in GSEA for convenient forms of payment processing.

urrently, our digital financial services business primarily generates revenue from commissions charged to merchants for transactions settled using the AirPay platform. Each merchant pays a commission, which is either a percentage of the transaction value or a fixed fee per transaction. For transactions completed using our AirPay App, we are entitled to the entire amount of the commission, less any banking or credit card fees. For transactions transacted over an AirPay counter, a portion of the commission is shared with the counter operators. We believe that revenue sharing is important in recruiting and motivating new counter operators to join our network. Our digital financial services business also generates revenue from interest payments we receive from the small loans we provide to borrowers. We will continue to leverage our strong on-the-ground resources, local market and operational expertise, as well as regional platform capabilities, to grow the user base and expand the use cases of AirPay. Although we do not currently provide some traditional financial services, such as brokerage, wealth management, insurance securities or retail lending, we plan to further build AirPay into a comprehensive digital financial services platform, supported by insights we develop from analyzing the potentially huge wealth of user data collected from the long-term operations of our consumer technology businesses.

As a natural extension of our digital financial services business, we began extending small loans to small businesses in Thailand in June 2016 through AirPay counters.

AirPay provides payment processing services for Shopee in Vietnam and Thailand by handling incoming payments to Shopee accounts under Shopee Guarantee as well as the outgoing payments from Shopee accounts to Shopee seller accounts.

Garena’s strong relationship with a large network of cybercafés has enabled AirPay to rapidly establish a wide network of AirPay counters. As of June 30, 2017, 73.3% of cybercafés within the Garena network, or 50.0 thousand in total, also operated as AirPay counters. In addition, AirPay processes transactions of prepaid game credits on our Garena platform in Indonesia, Vietnam and Thailand. During the month of June 2017, AirPay processed approximately 40% of the aggregate gross billings for our digital entertainment business across AirPay’s three largest markets, namely Thailand, Vietnam and Indonesia. AirPay also provides the payment processing for Shopee in Vietnam and Thailand, with all incoming payments to Shopee accounts under Shopee Guarantee as well as the outgoing payments from Shopee accounts to Shopee seller accounts operationally handled by AirPay. This payment processing service is an initial step in our long-term plan to further integrate AirPay with the Shopee platform and make the e-wallet function an integral payment option for Shopee users, creating a large captive user base for AirPay.

An AirPay counter is a physical over-the-counter retail location that maintains a balance in its AirPay e-wallet account, which is used to purchase electronic and physical goods and credits, such as prepaid game credits and mobile top-up, food, beverage and other convenience store items, from suppliers or service providers. The AirPay counter then sells those electronic and physical goods and credits to consumers who pay the counters in cash. AirPay counters also provide utility bill and other payment forwarding services to consumers for cash payments. AirPay counters can be found at a variety of convenient locations in Thailand, Vietnam, Indonesia and the Philippines, including cybercafés, small local shops, book stores, food and beverage merchants, sim card stores, accommodation providers and convenience stores. AirPay counters also serve as important cash AirPay 柜台是一个实体的柜台零售点，在其 AirPay 电子钱包账户中保持一个余额，用于从供应商或服务提供商处购买电子和实体商品及信用，例如预付游戏信用和移动充值、食品、饮料和其他便利店物品。空中支付柜台然后出售这些电子和实物商品和信贷的消费者谁支付的柜台现金。AirPay 的柜台还为消费者提供水电费账单和其他现金支付转账服务。在泰国、越南、印尼和菲律宾的多个便利地点，都可以找到空中支付柜台，包括网吧、本地小型商店、书店、食品和饮料商店、智能卡商店、住宿供应商和便利店。AirPay 柜台也是重要的现金来源   163 Table of Contents 目录 access points for the platform. By allowing consumers to pay cash to top up their accounts on the AirPay App, AirPay counters act as a “reverse ATM” providing important avenues for the AirPay App to reach the large unbanked populations in GSEA. 平台的接入点。通过允许消费者在 AirPay 应用程序上支付现金以充实自己的账户，AirPay 柜台就像一台“反向自动取款机”，为 AirPay 应用程序接触到 GSEA 大量无银行账户的人群提供了重要渠道。

Consumers using the AirPay App do not need a credit card or a bank account, as the AirPay App accepts account top-up payments in cash through any of our AirPay counters, in addition to direct bank transfers. The user interface of the AirPay App in each market is localized to reflect local use cases and user preferences.

An AirPay counter is a physical over-the-counter retail location that maintains a balance in its AirPay e-wallet account, which is used to purchase electronic and physical goods and credits, such as prepaid game credits and mobile top-up, food, beverage and other convenience store items, from suppliers or service providers. The AirPay counter then sells those electronic and physical goods and credits to consumers who pay the counters in cash. AirPay counters also provide utility bill and other payment forwarding services to consumers for cash payments. AirPay counters can be found at a variety of convenient locations in Thailand, Vietnam, Indonesia and the Philippines, including cybercafés, small local shops, book stores, food and beverage merchants, sim card stores, accommodation providers and convenience stores. AirPay counters also serve as important cash AirPay 柜台是一个实体的柜台零售点，在其 AirPay 电子钱包账户中保持一个余额，用于从供应商或服务提供商处购买电子和实体商品及信用，例如预付游戏信用和移动充值、食品、饮料和其他便利店物品。空中支付柜台然后出售这些电子和实物商品和信贷的消费者谁支付的柜台现金。AirPay 的柜台还为消费者提供水电费账单和其他现金支付转账服务。在泰国、越南、印尼和菲律宾的多个便利地点，都可以找到空中支付柜台，包括网吧、本地小型商店、书店、食品和饮料商店、智能卡商店、住宿供应商和便利店。AirPay 柜台也是重要的现金来源   163 Table of Contents 目录 access points for the platform. By allowing consumers to pay cash to top up their accounts on the AirPay App, AirPay counters act as a “reverse ATM” providing important avenues for the AirPay App to reach the large unbanked populations in GSEA.

AirPay was initially launched to provide a cost-effective payment solution for our digital entertainment business. We have since integrated our AirPay platform with third-party merchants and cover an increasingly broad set of consumption use cases such as food, entertainment, transportation, mobile telecommunications and bill payment. As of June 30, 2017, we offered 388 use cases across 13 use case categories. This, in turn, attracts a large and growing number of consumers to our platform. Moreover, by integrating with local, regional and global banks and third-party payment gateways, we have built AirPay into a one-stop payment platform facilitating online transactions, which is integrated with local commerce infrastructure and designed to lower transaction costs for us and for our merchant partners.

AirPay was launched in Vietnam in April 2014, in Thailand in June 2014, and recently began limited operations in Indonesia, Taiwan and the Philippines. The AirPay App is available in Thailand, Vietnam and Taiwan, and AirPay counters are operating in Thailand, Vietnam, Indonesia and the Philippines. Through our AirPay e-wallet services, our users can make payments for a wide variety of products and services, such as food, entertainment, transportation, mobile telecommunications and bill payment