Credit: Visa Visa has won approval to start preparing a domestic bank card clearing business in China, the company said on Tuesday. The People’s Bank of China approved its “Application to Prepare”, which lets Visa begin formal preparations. It does not yet let Visa process domestic payments. Visa first applied to the central bank in May 2020, CNBC reported.
Visa did not give a date for when it expects to start operating. “We look forward to taking the necessary steps in the process, pursuant to the PBOC’s regulations, to begin operating domestically in China,” Visa chief executive Ryan McInerney said in a statement. In the same statement, McInerney credited the leaders of the US and China for the relationship between the two economies. The politics around the licence McInerney joined President Donald Trump’s business delegation to Beijing in May, as Evelyn Cheng reported for CNBC. He became chair of the US-China Business Council in June.
He led a council trip to Beijing in early September. Trump told Fox News after the May trip that he had raised Visa’s request for market access, according to CNBC. After the September summit, China said it would approve applications from all foreign financial institutions to operate in the country. The two governments have also opened talks on technology.
In September, Xi told Trump the two countries could jointly prevent AI misuse. They later agreed an AI incident channel. George Chen is a partner at The Asia Group. He told CNBC the approval came just before next month’s APEC leaders’ meeting in Shenzhen, where Xi and Trump are expected to meet. “The move suggests that Beijing is keen to demonstrate tangible progress for American businesses before Trump’s next visit to China,” Chen told CNBC.
Rivals got there first China has kept tight control of its financial sector and favoured domestic players. Visa’s main US rivals already have approval. American Express was first. It received the central bank’s nod in 2018 and a processing licence in June 2020.
Mastercard’s joint venture got approval to begin preparations in February 2020 and started processing payments in 2024. Until now, Visa has worked with Chinese banks on dual-branded cards. China’s UnionPay processes those transactions at home, while Visa handles payments abroad. Most everyday consumer payments in China run through mobile apps.
The main ones are Tencent’s WeChat and Ant Group’s Alipay. Visa, Mastercard and Ant International teamed up last month on ID checks for agents that shop on behalf of people.
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