China's UnionPay Processes More Than $6.7 Trillion in 2014, Expands to Hong Kong and Australia

China’s leading payment service provider UnionPay is partnering with Hong Kong’s ATM operator JETCO to provide a tap-and-pay payment service. UnionPay has reportedly bought a 3% stake in JETCO. The deal has made UnionPay a strategic investor and has allowed the firm to name candidates for JETCO’s board of directors.

JETCO confirmed that its QuickPass near-field communication (NFC) platform for contactless transactions will support UnionPay’s QuickPass credit cards later this year. Hence, smartphones with near field communication features are much needed. The system currently supports Visa and Mastercard, enabling users to swipe their mobile phones to pay for goods and services. Customers will have to link their UnionPay card with a smartphone through the SIM card. With this, customers will be able to pay for goods and services at malls, restaurants and parking lots in Hong Kong and Macau. At present, the number of such terminals in Hong Kong and Macao is estimated at over 3,000 while there are about 5 million of them in mainland China. Customers can pay up to a limit of HK $500 per transaction.

Together, the firms also plan to develop a remote mobile online payment service which would be launched in Hong Kong by the end of this year. The service will allow a user to conduct peer-to-peer transactions once his/her phone number is linked to a bank account. A customer will just have to enter the mobile number of the recipient in the mobile app and the transaction will occur instantaneously. Likewise, it is also expected that the firm will launch cross-border cash withdrawals in the near future.

UnionPay has been directly competing with the likes of Visa and MasterCard. It has more than 4.6 billion bank cards in circulation with a network spread across more than 150 countries. At the end of 2014, UnionPay had processed US$6.7 trillion. According to the company, credit cards bearing the UnionPay stamp are now accepted by over 26 million merchants and 1.8 million ATMs in 150 countries. The company has also announced its expansion into Australia where ATMs in Australia will accept UnionPay cards and UnionPay QuickPass for the first time.