Among the designer brands from Prada to Chanel at the Harrods flagship store in London, Chinese housewife Li Yafang spotted a logo she knows from back home: the red, blue and green of UnionPay cards.
“It’s very convenient that I can now use my UnionPay card” to shop abroad instead of carrying a stack of cash, said the 39-year-old, who was buying the same 1,190-pound (US$1,920) Prada Saffiano Lux handbag carried by the hit woman in the “Mission: Impossible -- Ghost Protocol” movie. “I hope more places abroad will accept UnionPay.”
Her wish is becoming reality as UnionPay, founded 10 years ago in Shanghai by the State Council and central bank, extends its reach. With more plastic in circulation than any other payment network -- 2.9 billion cards, or 45 per cent of the world’s total last year -- UnionPay is now accepted in 135 countries. Its rise is causing friction as the firm grabs market share from Visa as well as MasterCard, which UnionPay surpassed in customer spending in the first half of the year.
“UnionPay has absolute dominance in China, and it’s now expanding beyond that to become a top global player,” James Friedman, a New York-based analyst at Susquehanna International Group who covers payments firms including Visa, said in a telephone interview. “Their numbers show they are already in the league of Visa and MasterCard.”
A case brought by the US government to the World Trade Organization and ruled on in July challenged China’s requirement that foreign card issuers -- including Citigroup, which in August became the first Western bank in China to issue solely branded credit cards -- must use UnionPay’s network for yuan- denominated transactions.
The rules, along with those requiring all Chinese automated teller machines and merchants to use its network, prompted the WTO to order that China stop discriminating against foreign payment companies.
My next step isn’t any nation. It’s the world