Mastercard JV obtains regulatory approval
February 18, 2020 Category China News Round-up, Weekly
The online clearinghouse joint venture of U.S. credit card firm Mastercard has gained regulatory approval, another sign of China further opening its financial markets. In a statement posted on its website, the People’s Bank of China (PBOC), the country’s central bank, announced that it, together with the China Banking and Insurance Regulatory Commission (CBIRC), has approved an application by Mastercard NUCC Information Technology (Beijing) Co to operate a bankcard clearing house in China. Plans to set up the joint venture (JV) between Mastercard and Chinese online payment clearing house NetsUnion Clearing Corp (NUCC) were announced last year. Mastercard owns 51% of the JV.
The opening of the bankcard market is a vital component of the country’s financial deregulation, making domestic payment and clearing services more open and internationalized. The JV is required to finish preparatory work within one year and file with the central bank to begin operations. “We are delighted and encouraged by this latest decision from the PBOC,” Ajay Banga, President and CEO of Mastercard, said in a statement, noting that China is a vital market for the company. The Mastercard announcement came after the PBOC’s approval in late 2018 of a JV between American Express Co, one of Mastercard’s rivals, and Chinese fintech firm Zhejiang Lianlian Group to set up a bankcard network.
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