Full Breakdown
Visa Gains PBOC Approval to Prepare Domestic Bank Card Clearing Business
By Drooid · · How we work
Core Event: PBOC Approves Visa’s Preparation Phase
- On October 13, the People’s Bank of China (PBOC) issued an administrative approval allowing Visa Information Technology (Beijing) Co Ltd to begin preparatory work for a domestic bank-card clearing institution. Visa must complete preparation within one year before it may apply for a full clearing licence.
Background & Context
- Visa first applied to establish a domestic bank-card clearing institution in May 2020. Competitors American Express and Mastercard already operate domestic clearing in China through joint-venture arrangements. The approval follows high-level diplomatic engagement between President Donald Trump and President Xi Jinping, including a May business delegation to Beijing and an anticipated third summit later in the year.
Key Figures & Groups
Data & Statistics
- China’s bank-card ecosystem processed 4.6 trillion transactions worth 963.60 trillion yuan (? $143.92 trillion) in 2025, according to the central bank. The market is dominated by state-controlled China UnionPay, with three licensed foreign clearing entities (American Express, Mastercard, and Visa pending a final licence).
Official Statements & Responses
- Visa described the approval as a “significant step forward” in its commitment to China and thanked the constructive relationship between the United States and China.
- The PBOC’s notice requires Visa to finish preparatory activities within a year and then submit a licence application, to be reviewed jointly by the central bank and the National Financial Regulatory Administration.
- George Chen called the timing “notable,” suggesting Beijing aims to demonstrate progress for American businesses ahead of the upcoming APEC Leaders’ Meeting in Shenzhen.
Verbatim Quotes
- “The approval of our Application to Prepare marks a significant step forward in Visa's long-standing commitment to China,” — Visa CEO Ryan McInerney
- “We greatly appreciate the important role of the leaders of the United States and China in pursuing a constructive and strategically stable relationship between the world’s largest economies,” — Visa CEO Ryan McInerney
Why It Matters
- Direct domestic clearing would let Visa settle yuan transactions through its own network, reducing reliance on UnionPay and diversifying payment options for Chinese consumers and foreign visitors. For Visa, the move could expand global transaction volume and strengthen its competitive position against Mastercard and American Express.
Conflicting Reports & Gaps
- All sources concur on the approval date and the one-year preparation window. No source provides a definitive timeline for when the final clearing licence might be granted, leaving the exact market-entry date uncertain.
What’s Next
- Visa must complete its preparatory work by the end of the one-year period and then apply for a full bank-card clearing licence. The outcome of the upcoming APEC Leaders’ Meeting in Shenzhen may influence the regulatory environment for foreign financial firms in China.