Apple Pay strikes agreement with China’s bank card organization, UnionPay

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South Korea and the United States are bases for some major mobile payment systems which are now and will soon serving several other countries in Europe and North America. But alas, China has been the elephant in the room and the hardest nut to negotiate a way into. Within China, Alibaba’s been doing the work, but with a surge of interest in Apple, it’d help things out that Apple get in and play.

It seems that it has as the company has reportedly struck a preliminary agreement with China’s only domestic card issuer, UnionPay, to use the payment network’s point-of-sales system of more than 5 million merchants’ NFC receivers to support Apple Pay.

Details are on hold, pending issuing banks’ feedback and willingness to sign on with both companies.

If things hold up for Apple to enter the market, it will step right in front of a mountain of challenges: Alibaba controlled 83 percent of the mobile payment market last year. Alipay touts a name-verified user base of over 400 million and more than 130,000 merchants.

Another challenge would be fees. In the US, bank-to-merchant fees stand at 2 percent of purchases with Apple itself 0.15 percent of the purchase. In China, the general bank fee seems to be around 0.38 percent.

Apple does have the chance to make up some ground as mobile-payment transactions in China totaled $3.5 trillion last year,

Source: Bloomberg
Via: iClarified

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About The Author
Jules Wang
Jules Wang is News Editor for Pocketnow and one of the hosts of the Pocketnow Weekly Podcast. He came onto the team in 2014 as an intern editing and producing videos and the podcast while he was studying journalism at Emerson College. He graduated the year after and entered into his current position at Pocketnow, full-time.