Three weeks after completing a mobile payment development agreement with China Mobile, the China UnionPay card brand has signed on eight banks to launch a contactless mobile payment system in Shanghai.
China UnionPay and the banks will introduce a Near Field Communication-based mobile wallet that allows customers to link their UnionPay cards to certain phones from China Mobile, UnionPay announced July 17.
The banking partners Bank of China, Bank of Shanghai, Bank of Beijing, China Everbright Bank, China CITIC Bank, GF Securities, China Minsheng Banking Corp. and Shanghai Pudong Development Bank are seeking retail partners to accept mobile payments.
Consumers with NFC-enabled handsets can use the new mobile wallet to initiate low-value payments in stores. Merchants with NFC terminals can offer deals and rewards straight to the mobile phones, UnionPay says in a press release.
UnionPay says its cooperation with China Mobile allows the companies to "jointly explore" the application of more payment functions through mobile phones while promoting bank-issued payment cards.
The system will use the phone's SIM card and secure element to store payment account details, UnionPay says.
Consumers can use their phones to make payments at any terminals or vending machines displaying UnionPay's "Quick Pass" logo or China Mobile's "Mobile Phone Wallet" logo.
UnionPay and China Mobile plan to launch the mobile payments system in several Chinese cities, gradually building to 100 regions.