The electronic payments behemoth on Tuesday announced that it received the nod from the People's Bank of China, the country's central bank, to set up a bank card clearing business, giving it access to the country's $27 trillion payments market.
Mastercard and its partner, NetsUnion Clearing Corp (NUCC) will need to complete preparation work within a year, at which point the company will be able to apply for formal approval to begin domestic bank card clearing activity, Mastercard said.
Mastercard's application was submitted by Mastercard NUCC Information Technology (Beijing) Co., Ltd, a joint venture of Mastercard and NUCC.
The approval not only represents China’s ongoing efforts to open up its capital markets to outside participants like Mastercard, it also symbolizes its commitment to reforming and updating its capital markets and payments network to make it more integrated and global - something it agreed to as part of the recent phase one trade agreement with the U.S.
As part of the recently signed accord, Chinese regulators said they would take no longer than 90 days to consider applications from providers of electronic-payments services such as Mastercard, Visa (V) - Get Report and American Express (AXP) - Get Report. Mastercard set up its majority-owned joint venture nearly a year ago.
Shares of Mastercard were up 1.24% at $334.28 in trading on Tuesday.
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