Visa wins China central bank approval to prepare domestic card clearing business

Visa said on October 13 that the People’s Bank of China has approved its Application to Prepare, allowing it to begin formal preparations to establish a domestic bankcard clearing institution in China, according to the company’s release. The approval does not yet allow Visa to process domestic payments in China, according to The Next Web.

Under terms set by Chinese authorities, Visa has one year to finish its preparatory work before it becomes eligible to apply for permission to start domestic clearing operations, according to the Associated Press as reported by Quartz. Visa filed its application with the central bank in May 2020, according to CNBC, also cited by Quartz. Visa has not said when it expects to begin domestic clearing operations, according to Yahoo Finance.

Chief executive Ryan McInerney said the approval is a significant step in Visa’s long-standing commitment to China. He said Visa appreciates the role of US and Chinese leaders in pursuing a “constructive and strategically stable relationship” between the two economies.

Visa’s main US rivals already hold approvals. Mastercard’s China joint venture received preparation approval in February 2020 and began processing payments in 2024, and American Express secured its processing licence in June 2020, according to CNBC as reported by Quartz. China opened its domestic bankcard clearing market to foreign companies in 2016, according to Electronic Payments International. China’s UnionPay processes domestic transactions, while Visa handles payments abroad, The Next Web reported.

Visa completed the first live business-to-business agentic transaction in Greater China with Lianlian DigiTech in July.