Card Networks Push To Develop A Presence in China

Visa and MasterCard are trying to find new ways to work around Chinese regulation that prevent the foreign card companies from processing yuan transactions.  While Chinese consumers can use foreign cards, currently they are allowed to do so for the clearance of foreign currency, as has been the case since their entrance into the market 20 years ago.

However, recently the squeeze has been more acutely felt, reports Want China Times,  as credit cards using the PBOC specification are growing in popularity – cards bearing both the logos of foreign financial services companies and that of China UnionPay falling out of favor.  Chinese banks are still allowing cards issued by foreign financial service institutions, but their usage has fallen sharply when compared to China Union Pay.

However, among high end purchases, Visa and Mater Card are still holding down the advantage.  According to a report by China Union Pay, Visa held a 47.9 percent share of high-end credit card transactions in China, while MasterCard accounted for 23.6 percent and UnionPay 28.2 percent.

Both card companies are looking to strengthen the presence in the Chinese mobile market with programs like MasterPass, and to beef up internal security.

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