The payments landscape for cross-border e-commerce has witnessed another strategic retreat. While competition in European and American markets intensifies, Southeast Asia was once considered a new growth frontier. However, reality has fallen short of expectations. Recent reports indicate that Atome, a Singapore-based Buy Now, Pay Later (BNPL) platform focused on Southeast Asia, has decided to shut down its China operations and dismiss most of its local team, retaining only a skeleton crew for winding down operations.
Underperformance Forces Atome's China Exit
Sources reveal that Atome's withdrawal stems primarily from disappointing business performance in China, with limited customer acquisition and growing difficulties in market expansion. Despite actively partnering with cross-border e-commerce service providers since entering the Chinese market in August 2021, Atome failed to achieve meaningful market penetration. A former business development executive confirmed the team's dissolution, citing unfavorable market conditions.
Notably, Atome is backed by substantial financial support from Advance Intelligence Group, with investments from prominent institutions including Standard Chartered Bank and SoftBank Vision Fund. Other investors include Warburg Pincus, Northstar Group, Vision Plus Capital, Gaorong Capital, and Singapore's EDBI. Despite this impressive financial backing, Atome couldn't establish sustainable operations in China.
Strategic Partnerships Yield Limited Results
Atome aggressively pursued partnerships with cross-border payment service providers like Oceanpayment and Airwallex in 2022. The platform also integrated with multiple independent store builders including GiiMall, Meshop, and Shoplazza. Major cross-border sellers such as SHEIN and PatPat adopted Atome for their Southeast Asian operations.
However, most merchants remained cautious about BNPL adoption, reflecting limited consumer acceptance in Southeast Asian markets. Industry analysts note that while some premium brands implemented Atome to enhance brand perception, most price-sensitive sellers avoided the service due to cost considerations.
Market Realities Challenge BNPL Model
A veteran Southeast Asian e-commerce operator (speaking anonymously) explained that Atome primarily targets markets like Southeast Asia and Japan. However, Chinese cross-border sellers predominantly operate through established marketplaces rather than independent stores in these regions. Industry data shows only 3.09% of Chinese cross-border merchants maintain Southeast Asian independent stores, compared to 78.87% using Shopee.
The 5-7% commission per transaction further discouraged adoption among merchants operating on thin margins. While premium brands might absorb these costs for customer acquisition, most small-to-medium sellers prioritize profitability over payment flexibility.
Implications for Cross-Border E-Commerce
Atome's China retreat highlights fundamental differences between Southeast Asian and Western e-commerce ecosystems. The platform-centric nature of Southeast Asian markets, combined with price sensitivity among both consumers and merchants, creates significant barriers for BNPL adoption.
This development serves as a cautionary tale for payment providers and cross-border merchants alike—successful models in mature Western markets don't necessarily translate well to emerging Southeast Asian economies. The episode also raises broader questions about the viability of BNPL models in regions with different consumer credit cultures and purchasing behaviors.