U.S. payment companies frustrated by Chinese regulations blocking direct access to its vast consumer market could get a break under the terms of a new U.S.-China trade deal.

Chinese regulators agreed to begin offering licenses to wholly owned U.S. payment companies, which should lead to “full and prompt market access” the U.S. Commerce Department said in a May 11 statement summarizing a new plan for U.S.-China economic cooperation.

The deal would also allow Chinese banks to issue “dual brand-dual currency bankcards” that allow U.S. electronic payment services providers to process foreign currency payment card transactions.

Bloomberg News

By July 17, 2017, China will craft any further guidelines needed to begin the licensing process, according to the statement. Licensing itself could take several months, but observers say the move is long overdue.

If China opens its doors for Visa, Mastercard, American Express Co. and Discover Financial Services to issue cards to Chinese consumers, it would mark an abrupt change from longstanding policies that obstructed U.S. card networks from obtaining the necessary licenses, and answer a decade of lobbying by U.S. payment companies for direct access to China.

“With respect to China, we welcome last week’s announcement and look forward to having full and prompt market access in China,” a Mastercard spokesperson said.

A Visa spokesperson said: "Visa is committed to building our business in China for the long-term and we hope that domestic market opening in the electronic payments sector will be a positive step toward further strengthening the U.S.-China bilateral trade relationship."

Amex and Discover were not available for comment by deadline.

The World Trade Organization in 2012 ruled that China discriminates against foreign payment companies, while China’s state-owned China UnionPay enjoys a monopoly in China, and UnionPay cards are accepted in more than 160 countries.

Chinese payment companies, including Jack Ma’s Ant Financial, are making bold moves outside of China. Ant's Alipay, a leading Chinese online payments platform, last month announced a processing deal with First Data that aims to expand Alipay acceptance to 4 million U.S. retail checkout points First Data supports.

Ant Financial in January also proposed to buy U.S.-based MoneyGram for $1.2 billion, a move that has caused some U.S. lawmakers to raise questions about entrusting data security for a U.S. money-transfer agency to a foreign company. In its counter-offer for MoneyGram, Kansas-based Euronet Worldwide emphasized similar concerns around money-laundering and fraud.

Ant Financial wants to expand its global reach, and MoneyGram's network of more than 350,000 retail locations in 200 countries could provide it, analysts say.

Similarly, U.S. payment card issuers are looking to grow beyond mature markets and China is on track to become the world’s largest payment card market by 2020.

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