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Print Edition> Business
UPDATED: February 9, 2015 NO. 7 FEBRUARY 12, 2015
A Rapid Rise
Fast growing payment network China UnionPay seeks presence in overseas market
By Deng Yaqing

Cai Jianbo, CEO of UnionPay International, noted that in recent years, efforts have been made to promote cooperation, improve local card use and refine the entire service system. By joining hands with BC Card Co., he claimed, UnionPay can substantially improve the user experience by coordinating its service and marketing resources.

As consumer demand becomes increasingly diversified, UnionPay has unveiled a wide selection of personalized services and products, such as tax refunds, cross-border mobile payments and tax-hailing payment services. At the end of 2014, the company announced its decision to team up with Korea Smart Card Co. Ltd., the issuer of T-Money cards. In the near future, Chinese tourists will be able to pay for public transportation across the whole of South Korea and for purchases in designated areas just by swiping their UnionPay cards.

"Given the strong purchasing power, UnionPay has to make preparations ahead of time. If not, its rivals will gain an upper hand," said Sheng, clearly reveling in the fact that South Korea has become the most convenient overseas market for UnionPay cardholders and the first choice for Chinese consumers.

"Where there are Chinese tourists, there are UnionPay-branded services. Now, Chinese consumers demand higher quality of services than before," said Cai, who believes the international popularity of a company lies in its state-of-the-art services rather than its large breadth.

As a matter of fact, its rapid rise in South Korea doesn't rely entirely on Chinese tourists. "As bilateral economic and cultural exchanges between China and South Korea become more frequent, South Koreans' demand for yuan settlements is shooting up," said Rui.

According to statistics from a survey on China's banking industry published by Hexun Financial and Communication Research Institute in January, by October 2014, UnionPay had issued over 30 million cards overseas, one third of which were for South Korea. In other words, on average, one in five South Koreans owns a UnionPay card.

Overseas expedition

At present, UnionPay still lags behind Visa and MasterCard in terms of international business, admitted Ge, President of UnionPay International. While Visa cards can be used in roughly 39 million merchants across the world and 32 million of them are located outside the United States, more than half of the 26 million merchants that allow consumers to use UnionPay cards are based in China.

"For one thing, Chinese people are increasingly longing for overseas shopping; for another, Chinese enterprises have quickened their steps to get themselves out there," said Ge, who noted that all of the aforementioned have made expanding the coverage and scope of UnionPay services in overseas markets an urgent task.

On November 18, 2014, UnionPay announced its plan to initiate all-round cooperation with Westpac Banking Corp. of Australia, whose merchants and ATMs will be compatible with UnionPay within two years. On November 20, UnionPay established cooperative ties with Immigration New Zealand to provide more streamlined and convenient services for UnionPay cardholders who apply for a New Zealand visa. On November 27, UnionPay reached an agreement with Global Collect, a global payment service provider, on online payment business, which allowed them to cover more airlines and hotels.

UnionPay President Shi Wenchao said the company hopes to accelerate cooperation on emerging business, such as mobile payment and near-field communication payment, and explore business models based on innovative technologies.

Email us at: dengyaqing@bjreview.com

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