You are here: Home » Reuters » News
Business Standard

AmEx wins China approval to clear card payments

Reuters  |  BEIJING 

(Reuters) - Co on Friday won approval to clear card payments in China, making it the first U.S. to gain direct access to what is set to be the biggest card market by 2020.

The move comes months after started allowing foreign companies to apply for licenses and ahead of a meeting in where the and will try to resolve their trade disputes.

The preliminary approval allows the company to process and settle payments in yuan domestically by setting up its own network with its Chinese joint venture partner

Rivals Visa and have also submitted requests for licenses but are yet to get approval.

AmEx's JV, named Express (Hangzhou) Technology Services Co, is required to complete operation preparations within a year and get a nod from the central before running the card clearing business, the People's of said in a statement on its website.

The approval is a "significant step toward opening up China's to foreign investors", the central bank said, adding that it would continue to ease in an orderly way market access for clearing and settlement institutions.

Up until now, foreign card companies have had to partner with China's UnionPay, a state-controlled consortium that enjoyed a monopoly on all yuan cards issued and used in the country, for access to the country's

Foreign card companies, especially behemoths like Visa and Mastercard, have been lobbying for more than a decade for direct access to - where the number of cards in circulation is expected to rise to 9 billion by 2020 from 6 billion in 2016, according to research firm

counts Visa, Mastercard, and among its partners for in China.

Visa was the first to submit its application for a license in July 2017 but its request was put on hold and the company was asked to firm up its local equity partnership before resubmitting its application, sources told last year.

told on Friday that it would continue to remain engaged with regulators during the application process.

(Reporting by Monitoring Desk, Shu Zhang, and Aparajita Saxena; Editing by Kim Coghill, and Anil D'Silva)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, November 09 2018. 20:53 IST