China UnionPay quest for UK banks signature to ensure HSBC cardholders ATM use starting April 2016

However, at least 60% of cashpoints will still work for UnionPay users, scmp.com reports. HSBC is warning customers in Hong Kong that its UnionPay-backed ATM and credit cards may not work at some cashpoints in the UK from April 2016 due to regulatory changes there.

To ensure the cards remain valid, UnionPay, China’s only domestic bank card organisation, is now engaged in talks to sign separate agreements with each of its 36 member banks in the UK of the Link network, as mandated by the amended rules.

Unless more deals are inked by 1 April 2016, Hongkongers may find themselves unable to withdraw cash as thousands of people fly to UK during the Easter holidays. The problem will affect at least 27,000 UK cashpoints run by Link, which operates a network of 66,700 ATMs.

HSBC has warned its customers about the problem and recommended they prepare to withdraw cash from its branches in the UK. Other Hong Kong-based banks are thought to be affected, too. However, a spokesperson for London-headquartered HSBC told the Sunday Morning Post that UnionPay has signed new contracts with operators of 60% of the UK cashpoints, teh source cites.

UnionPay said customers of banks will “temporarily experience interruption” during the Easter holidays. It was unclear whether mainland Chinese users of UnionPay would also struggle to withdraw money in the UK. HSBC said it could not be sure how many clients would face problems - which include how many intended to travel to the UK.

HSBC will be keen to avoid a repeat of the problems its customers faced in 2013 when the bank switched to chip-embedded cards with UnionPay as the network provider. As UnionPay only worked in a handful of Asian countries at the time, many customers were unable to withdraw cash abroad.

The latest changes come as UKs payments regulator ordered a consortium of UK banks to sell VocaLink in a bid to boost competition and innovation. The payment systems company processes around 90% of UK salaries and handles all UK bank payment transfers.

HSBC said it is working with UnionPay to resolve the matter and has urged the company to sign more agreements before 1 April 2016.