Visa has secured regulatory approval to start preparations to establish a domestic bankcard clearing institution in China.
In a statement released today, the payments company said it has received approval for its ‘Application to Prepare’ from the People’s Bank of China (PBOC) to start the formal process required before it can operate domestic bankcard clearing services in the country.
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Visa described the move as an “important milestone”, adding that it will continue working through the required procedures under PBOC regulations.
The approval follows a summit between US President Donald Trump and his Chinese counterpart Xi Jinping last month.
Visa CEO Ryan McInerney said: “The approval of our Application to Prepare marks a significant step forward in Visa’s long-standing commitment to China. We greatly appreciate the important role of the leaders of the US and China in pursuing a constructive and strategically stable relationship between the world’s largest economies.
“For more than 40 years, Visa has been an active contributor to China’s dynamic payments landscape. We look forward to taking the necessary steps in the process, pursuant to the PBOC’s regulations, to begin operating domestically in China.”
Following this preparatory stage, the company will need to complete further regulatory steps before starting domestic bankcard clearing operations in China.
China opened its domestic bankcard clearing market to foreign companies in 2016.
However, it requires foreign entrants to set up local technology infrastructure as well as onshore backup data systems in the country, according to a Reuters report.
In 2023, competitor Mastercard secured regulatory approval to process domestic yuan-denominated transactions through a joint venture with NetsUnion.
Visa is scheduled to announce its fiscal fourth-quarter and full-year 2024 financial results on 27 October.
