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China’s central bank and the National Administration of Financial Regulation has finally issued a bank card clearing license to Mastercard.
Mastercard gets greenlight in China
The People’s Bank of China’s (PBC) approval of the application by the Chinese joint venture of Mastercard allows it to conduct yuan clearing operations and issue yuan-denominated bank cards.
The certificate was issued to a joint venture company in China, established by Mastercard and NetsUnion Clearing Corporation.
This authorization allows the joint venture to operate a yuan-oriented bank card business under the “Mastercard” brand in mainland China.
It is the second overseas bank card clearing institution approved by the PBC and the National Administration of Financial Regulation.
The move also follows intensive engagements between China and the United States to ease confrontation and level the playing field for businesses on both sides.
Currently, Chinese regulators have permitted American Express and now Mastercard, to enter the Chinese market and have issued the relevant business certificates, with the obvious exclusion being Visa.
Analysts noted that Mastercard, as the US’ second-largest bank card clearing agency, being granted permission to enter the Chinese market is a practical step in implementing the country’s policy of high-quality opening-up.
This move demonstrates an unwavering determination to further open up, according to a reports by China Media Group.
Furthermore, this authorization is expected to upgrade the domestic structure of the bank card clearing market and deepen the supply-side reform of the payment industry, aiming to better serve the country’s real economy and the livelihood of its people, as stated in the report.
The PBC has pledged to promote market access in the bank card clearing market according to relevant laws, to coordinate development and security, and to improve the regulatory mechanism of bank card clearing institutions, with the goal of facilitating the high-quality development of the payment industry.
In 2022, a total of 7.45 trillion bank card transactions were processed in China, amounting to 1,011.9 trillion yuan ($141.1 trillion), according to data released by the PBC.
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