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US card networks MasterCard, Visa, and American Express are preparing to submit a license request to operate in China, according to Reuters.

Although the process, which includes having to clear regulatory banking hurdles and security scrutiny, could take two years or longer, these card networks clearly see the massive opportunity in China.

China’s card market is poised to be the largest in the world, which makes entering the region a significant growth opportunity for US networks.

  • Cards are an integral part of the Chinese payment industry. China had over 6 billion cards in circulation in 2016, which will only increase over the next three years — cards in circulation are expected to rise to 9 billion by 2020, according to data by GlobalData Plc cited by Reuters. For context, this 2020 figure equates to roughly six cards per person in China.
  • The market has long been dominated by a single player, which could narrow the focus of challengers that hope to attract partners. UnionPay, the Chinese card network, has a complete hold on the market — it has a 90% market share of China’s card industry, according to Nilson data cited by Fox Business. As a result of the region having a clear-cut leader in the space, US card networks only have to focus on rivaling the offerings of UnionPay, rather than the entire industry.

The U.S. payments ecosystem is in the midst of a shift toward mobile, and countless new and old stakeholders are attempting to accelerate this migration, which is moving at a glacial pace relative to other markets globally. But mobile payments can rise to the mainstream. For companies seeking to build out a robust mobile payments product, China’s thriving mobile payments ecosystem offers some insight — and some lessons.

BI Intelligence, Business Insider’s premium research service, has compiled a detailed report on mobile payments in China that:

  • Forecasts and compares mobile payments volume, in-store mobile payments users, mobile payments volume per capita, and mobile commerce penetration in China and the U.S.
  • Overviews the key competitors in China’s mobile payments market, and how new entrants may shuffle the hierarchy of dominant players.
  • Uncovers the key drivers propelling China’s mobile payments market.
  • Identifies which drivers the U.S. can import from China, and which barriers may be standing in the way.

To get the full report, subscribe to an All-Access pass to BI Intelligence and gain immediate access to this report and more than 250 other expertly researched reports. As an added bonus, you’ll also gain access to all future reports and daily newsletters to ensure you stay ahead of the curve and benefit personally and professionally. >> Learn More Now

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