China's central bank has approved preparations by Visa's Chinese subsidiary to establish a bank card clearing institution, marking a further step in opening up financial services and implementing the outcomes of China-US economic and trade talks.

The approval, posted on the People's Bank (PBOC) of China website on Tuesday, paves the way for Visa-branded renminbi bank cards to be issued in China once the required business license is obtained.

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China Daily learned from the PBOC that the subsidiary must complete preparations within one year before applying to commence operations. A bank card clearing business license will be issued following approval by the PBOC and the National Financial Regulatory Administration.

Visa has long provided cross-border clearing services for foreign-currency bank cards in China. Until it obtains the license, Visa cannot issue Visa-branded renminbi bank cards in China or provide renminbi bank card clearing services to domestic entities.

"The approval of our Application to Prepare marks a significant step forward in Visa's long-standing commitment to China," said Ryan McInerney, chief executive officer of Visa. "For more than 40 years, Visa has been an active contributor to China's dynamic payments landscape. We look forward to taking the necessary steps in the process, pursuant to the PBOC's regulations, to begin operating domestically in China."

As one of the world's most advanced and dynamic digital payments markets, China is supported by a highly innovative ecosystem and continued commitment to further financial sector liberalization. Visa said it looks forward to contributing to the continued development of China's domestic payments landscape.

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China currently has three licensed bank card clearing institutions — China UnionPay and the local entities of American Express and Mastercard — with a more diversified and competitive market gradually taking shape.

Visa's entry would help diversify China's bank card clearing market, enrich onshore payment services and further improve payment convenience for overseas visitors, thereby supporting international exchanges and trade, market mavens said.

Contact the writers at zhoulanxv@chinadaily.com.cn