Citi and Standard Chartered have received the
go-ahead from the People’s Bank of China (PBoC), the country’s
central bank, to issue retail debit cards in the country, following
Bank of East Asia’s entry into the market earlier this year.
Locally incorporated foreign banks were given the green light to
offer debit cards in May 2007, pending approval from Chinese
regulators. The other major issuer now awaiting approval is
Standard Chartered has already launched its
debit card operations. Citi has not given a date for the launch of
its debit card services, but said it “expects to be in a position
to launch debit cards in the near future, pending final
Citi has also partnered with China UnionPay
Data Services, China’s largest bankcard third-party processor, to
outsource its debit card transaction processing onshore. This
aligns Citi with Chinese regulations stipulating that foreign banks
need to locate IT operations and data centres on the Chinese
mainland rather than operate offshore data centres. Currently, Citi
runs 25 consumer bank outlets in China.
Citi China CEO Andrew Au said: “We are
delighted to have been granted approval to launch debit cards in
“Citi strives to be the most customer-focused
international bank in China and we look forward to being able to
offer our customers the convenience and flexibility of debit
Citi’s emphasis on China reflects its growing
reliance on international markets to boost profitability, and the
much-touted growth prospects of the Chinese card market, which is
showing strong double-digit growth year-on-year.
In its 2007 annual report, Citi pointed to the
growth of its global card business which is helping to offset
stagnant business in its home US market. Citi’s global card
business generated 11 percent of total group revenue and income of
$4.89 billion in 2007.
The most recent figures from the PBoC show that
the total number of bankcards, including debit cards, rose to 1.58
billion in the year to March 2008, a rise of 29.1 percent. Debit
cards accounted for 1.47 billion of that figure.