Visa is taking significant steps towards establishing a bank card clearing business in China, marking progress in its efforts to penetrate the Chinese market. This development comes as the U. S. and Chinese presidents prepare for their third meeting this year, scheduled for next month.
Visa CEO Ryan McInerney expressed enthusiasm about the progress, highlighting the company's long-standing involvement in China's payments landscape. "For more than 40 years, Visa has been an active contributor to China's dynamic payments landscape, " McInerney stated. He emphasized Visa's commitment to complying with PBOC regulations to begin domestic operations in China.
McInerney, who joined U. S. President Donald Trump's business delegation to Beijing in May, has been actively engaging with Chinese officials. He was appointed chair of the U. S.-China Business Council in June and led a delegation to Beijing in early September. The timing of Visa's progress is noteworthy, partner and chair of digital practice at The Asia Group. He noted that Beijing's decision to move forward precedes the APEC Leaders' Meeting in Shenzhen, where Presidents Xi Jinping and Trump are expected to meet again.
Chen suggested that the progress reflects China's intention to show progress in opening its market to American businesses ahead of Trump's visit. Trump's discussions with Chinese officials during his May trip included Visa's market access request. Following a summit in September, China announced it would approve applications from all foreign financial institutions seeking to operate in the country.
China's financial sector has traditionally been tightly controlled, favoring domestic entities and limiting cross-border capital flows. Visa's application to the PBOC dates back to May 2020, aiming to establish a bank card clearing institution. The company has collaborated with Chinese banks on dual-branded cards, where UnionPay handles domestic transactions and Visa manages overseas payments. Earlier this year, Visa announced that cards issued in mainland China could be linked to Apple Pay for international use.
Visa's competitors have also made strides in the Chinese market. Mastercard's joint venture began processing payments in 2024 after receiving PBOC approval in February 2020. American Express was the first to secure a processing license, obtaining it in June 2020 following initial approval in 2018. Despite these developments, mobile payments remain dominant in China, with Tencent's WeChat and Alibaba-affiliate Ant's Alipay leading the way in daily consumer transactions.
