American Express received approval to start bank card clearing services in China, making it the first foreign payments network to be allowed to process local currency transactions in one of the world’s largest markets, reported Caixin.
The People’s Bank of China granted a network clearing license to American Express’s China joint venture, Express (Hangzhou) Technology Services Co., the central bank said in a statement on Saturday. The company, which won initial approval in 2018, is required to start the clearing service within six months, according to the statement.
The approval marks a win for the card giant amid rising political tension between the US and China sparked by the coronavirus outbreak and a crackdown on Hong Kong. It underscores China’s commitment to opening its $45 trillion financial markets this year, in a bid to attract foreign capital and support growth.
AmEx will face large domestic competitors and a well-developed market for mobile payments. Mobile transactions topped RMB 190 trillion ($27 trillion) in China in 2018, making it the world’s largest such market, according to iResearch. Ant Financial’s Alipay and Tencent Holding’s WeChat Pay are the dominant firms.