Mastercard renews efforts to operate in China
Mastercard is making another run at getting a license to operate in China, though China's changing regulatory posture has created skepticism about its willingness to open its market.
The Purchase, N.Y.-based card network said it is in active discussions to gain a license to access China’s domestic market.
It’s not the first time Mastercard has applied to Chinese authorities for a license. Mastercard and Visa in 2017 both applied for card acceptance in China, but both reportedly withdrew their licenses at different points last year.
American Express in the meantime gained preliminary approval in November 2018 to enter China’s market through a partnership with Chinese fintech company LianLian Group.
Mastercard’s announcement hints that it’s open to a similar approach to accessing China’s market with a local partner.
“Forming trusted partnerships remains a cornerstone of our operating philosophy around the world, and our approach in China is no different,” Ling Hai, Mastercard’s co-president of Asia Pacific, said in a press release.
Mastercard said it aims to present an application for a bankcard clearing license in China “in the near future."
China has failed to deliver on previous suggestions it would open its market to payment companies outside of its borders.
A Caixa report suggests one sticking point in China’s negotiations with U.S. card networks is China’s concerns about how U.S. card network would protect the rights of users and merchants in case of broad sanctions.
When the U.S. issued sanctions against Russia in May 2014 following Russia’s annexation of Ukraine’s Crimea, Russia retaliated with sanctions against Visa and Mastercard. Both U.S. card networks suspended operations in the Crimean region later that year.