Source: Yucheng Technologies
Yucheng Technologies Limited (Nasdaq: YTEC), a leading provider of IT solutions and services to China's banking industry, today announced that it has signed a contract and started providing Point of Sale (POS) merchant acquiring services to the Beijing Branch of China Construction Bank ("CCB Beijing"), following its initiation of partnership with CCB Guangdong Branch in providing such services in late February.
Yucheng's CEO, Mr. Weidong Hong stated: "We are excited to expand our partnership with China Construction Bank in providing POS merchant acquiring services. CCB Beijing is CCB's largest branch. Because Beijing has a relatively high level of consumer spending and bankcard adoption rate in China, our partnership with CCB Beijing provides us a new opportunity to expand our POS network as well as improve its overall quality in terms of per POS transaction value. CCB's partnership with us in Beijing also demonstrated their confidence in Yucheng's ability to help them promote their POS installation and increase their per POS transaction value."
Mr. Weidong Hong further commented: "Since our initiation of POS merchant acquiring business in partnership with China Merchants Bank over a year ago, we have built a professional team composed of 376 sales representatives and established our presence in 15 major cities across China. We made this significant infrastructure investment in the POS business because the initial results from our partnership with China Merchants Bank have been encouraging. The capital cost of each POS terminal has declined to US$225 from US$250 in the first quarter of 2008. The average monthly processed value ("APV") per POS terminal with more than three months of continuous operations in Q1 2008 surpassed US$7,000 (RMB49, 133 at 1 US dollar to 7.0190 RMB). This translates into roughly US$14 of revenue per month per POS terminal, without including additional potential revenue that may be generated when we begin to provide prepaid cards and affinity programs in partnership with banks and merchants in the future. Partnering with more banks to deploy POS terminals will enable us to make better use of our existing sales network and realize significant benefits from economy of scale, and we continue to receive inquiries from other banks about potential partnerships. With Chinese consumers' paying habits shifting from cash to bank cards, we are confident the POS network will deliver significant long-term value for our shareholders."