This would finally allow other companies such as MasterCard and Visa to tap the Chinese market and offer their services to consumers.
Currently, UnionPay is the only clearing service provider for CNY-denominated bank-card payments. In 2012, the World Trade Organization told the Asian nation to stop discriminating against foreign payment companies, a group of companies that also included American Express. The UnionPay’s rules, along with those requiring all Chinese automated teller machines and merchants to use its network, had prompted the WTO to make this move.
According to FBR Capital Markets analyst Scott Valentin, cited by online media outlet BusinessWeek, China’s market opening would represent a ‘huge opportunity’ for US payment networks.
Established in 2002 in Shanghai by the State Council and the central bank, UnionPay has more than 3.8 billion bank cards in circulation. In 2013, bank-card transactions increased 48% to CNY 32.2 trillion (USD 5.3 trillion) in China.
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