BEIJING: Visa said Tuesday it has received approval from the People's Bank of China to set up a bank card clearing business in the country, a long-sought step toward operating in China's domestic payments market.
The announcement comes as U.S. President Donald Trump and Chinese President Xi Jinping prepare for their third meeting this year.
"This marks an important milestone toward the company serving China's domestic payments market," Visa said in a statement.
Visa CEO Ryan McInerney said the company has been active in China for decades. "We look forward to taking the necessary steps in the process, pursuant to the PBOC's regulations, to begin operating domestically in China," he said.
McInerney joined Trump's business delegation to Beijing in May and became chair of the U.S.-China Business Council in June. He also led a trip to Beijing in early September.
George Chen, a partner and chair of the digital practice at The Asia Group, said the timing was notable. Beijing approved Visa's license just ahead of next month's APEC Leaders' Meeting in Shenzhen, where Xi and Trump are expected to meet again, he said.
"The move suggests that Beijing is keen to demonstrate tangible progress for American businesses before Trump's next visit to China," Chen said.
Trump told Fox News after his May trip to Beijing that he had raised Visa's request for market access. After a September summit, China said it would approve applications from all foreign financial institutions seeking to operate in the country.
A closed market
Mainland China has long kept tight control over its financial sector, favoring domestic companies and restricting cross-border capital flows.
Visa has said it applied to the central bank in May 2020 to operate a bank card clearing institution.
The company has worked with Chinese banks on dual-branded cards, in which China's UnionPay processes domestic transactions and Visa handles payments overseas. In January, Visa said cards issued in mainland China could be linked to Apple Pay for use abroad.
Rival Mastercard's joint venture in China said it began processing payments in 2024. The venture had received the central bank's approval to begin preparations for bank card clearing in February 2020.
American Express was the first U.S. card company to gain access. It received its processing license in June 2020, after getting the central bank's initial approval in 2018.
Mobile payments dominate daily consumer transactions in China, led by Tencent's WeChat and Alipay, which is affiliated with Alibaba's Ant Group.
