China's third-party payment firm Lakala is seeking initial public offering again despite last year's setback, its board chairman Sun Taoran revealed.

Lakala is the country's third largest third-party payment service provider, though its market share tails far behind the top two: Alibaba's Alipay and Tencent's Tenpay.

By the end of the third quarter of 2016, the top three accounted for more than 90 percent of market share, according to Analysis International, a Beijing-based Internet information consulting firm. 

Lakala attempted to go public last year through a merger with Tibet Tourism, but the procedure was called off by the regulator. In October, the company split its online lending business from its core operation -- the third-party payment.

Sun, also Lakala's founder, said after the split the company's payment arm is now being guided again to go public.

He said third-party payment services have come a long way since they emerged more than ten years ago. It is natural that they are now exploring the capital market.

Analysts expect the sector will see a wave of new listings in 2017 and 2018.

Sun said Lakala is not competing with Alipay or Tenpay as it focuses on businesses rather than individual customers. He said the company's priority this year is to promote the use of smart point-of-sale machines, whose market penetration rate is expected to reach 50 percent in the next three years.