Visa Gains Approval for Domestic Payment Operations in China
Visa is set to embark on establishing a local bank card clearing business in China, expanding its footprint in the lucrative payments market.
Visa's New Venture in China
Visa has recently received official approval to initiate preparations for its domestic bank card clearing business in China. This advancement follows in the footsteps of established competitors such as Mastercard and American Express, who have already made inroads into this expansive payments market.
Significance of the Approval
According to Ryan McInerney, CEO of Visa, this milestone reflects the importance of a constructive and strategically stable relationship between the United States and China. The approval was granted by the People’s Bank of China, as reported by the Xinhua News Agency on October 13.
Visa's Beijing subsidiary must now undertake necessary preparatory work within the next year before it can formally apply for a clearing business license. This approval represents a significant step forward, enabling Visa to tap into China's enormous payments landscape, valued at approximately $144 trillion.
A Long Journey Toward Approval
The journey to this approval has been extensive, with Visa initially applying for a license as far back as 2017. In comparison, Mastercard successfully established its bank card clearing business in 2020, while American Express followed suit shortly thereafter, forming a joint venture to provide card clearing services in China.
This entrance into the Chinese market has long fueled tensions in the broader trade relations between the two major economies. In a notable instance in 2016, former President Donald Trump mentioned Visa's market access request during talks with Chinese President Xi Jinping. McInerney accompanied Trump on that trip to Beijing, highlighting the significance of this issue at the time.
The Changing Landscape of Payments in China
However, Visa is entering a rapidly evolving market characterized by the dominance of domestic mobile payment platforms like Alipay and WeChat Pay. These applications have transformed the landscape of everyday transactions, rendering traditional card networks less central to the payments ecosystem.
As of the end of 2025, there were an impressive 10.2 billion bank cards circulating in China, with the total transaction value reaching 963.6 trillion yuan (approximately $144 trillion). This figures, released by the People’s Bank of China, illustrate the scale and competitiveness Visa will encounter.
China initially indicated a willingness to open up its bank card clearing sector in June 2015, allowing foreign players to apply for licenses via local entities or acquisitions. This directive aimed to dismantle the longstanding monopoly of the state-owned China UnionPay.
Looking Ahead
While Visa's recent approval marks a critical milestone, the company is stepping into a vastly different realm than the one it envisioned when it first sought entry into China. As it prepares for operational launch, it will need to navigate this modern payments landscape, where innovation and consumer preference are shifting rapidly.
As the situation unfolds, Visa's strategies will likely be closely watched, particularly in light of future discussions between U.S. and Chinese leaders scheduled for the upcoming Asia-Pacific Economic Cooperation Economic Leaders’ Meeting in November.