American Express has become the first foreign card scheme to win direct access to China's bank card market after winning approval for a clearing and settlement licence from the country's central bank.
The card scheme has formed a joint-venture with China's LianLian to build a network business that will enable charges on American Express branded cards to be cleared and settled domestically by the joint-venture.
Up until now, foreign card companies have had to partner with state-controlled monoopoly UnionPay for access to the country’s payments network.
The opening up of the market comes as China bids to mend fences with Trump's Government in the US and follows almost a decade of lobbying by US-based payment schemes.
American Express chairman and CEO Stephen Squeri says: “We are pleased to be the first foreign payments network allowed to build a network in mainland China. This is an important next step toward being able to bring the benefits and services of our global network to Chinese customers and expanding the ability of our global Card Members to use their American Express Cards in mainland China. We are also pleased to be working alongside LianLian, a long-term partner of American Express.”
Both Mastercard and Visa have submitted licence applications and await approval from the People's Bank of China to follow suit.