Visa Wins Preparatory Approval in China’s 963.60 Trillion Yuan Card Market
Key Facts
Visa said it had received approval from the People’s Bank of China for its application to prepare to establish a domestic bank card clearing institution, advancing its entry into a market where card transactions totaled 963.60 trillion yuan in 2025. The approval covers the preparatory stage before an application to begin operations and obtain a clearing business license. According to Caixin, the local entity involved is Visa Information Technology in Beijing. The announcement comes in a market where bank cards processed 4.6 trillion transactions that year, according to central bank data cited by Reuters. Those figures cover bank card transactions in China, while Visa’s approval concerns the establishment of a domestic clearing institution. Granting the company a license to conduct this business requires further regulatory approval of its application to begin operations.
Visa’s chief executive said the company had been active in China’s payments ecosystem for "more than 40 years," placing the new approval in the context of its longstanding presence in the country. The process approved by the central bank concerns the establishment of a domestic card clearing business, an activity in which payment networks play a role distinct from issuing cards to individuals. Analyst Wang Pengbo explained, in coverage republished by the Shanghai government’s financial office from the Shanghai Securities News, that clearing institutions are the card networks themselves. He said they do not issue cards directly to consumers but make their brands available to partner banks. Those banks issue cards bearing the network’s logo under the license granted to them.
Mastercard previously went through a process that began with preparatory approval before securing formal authorization for domestic clearing. The People’s Bank of China approved its joint venture’s application in principle in February 2020, according to a company statement. During the preparatory stage, the venture established the standards, rules and structures needed to comply with local regulatory requirements. The work also included building the business’s infrastructure, according to the same statement. In November 2023, the Mastercard and NetsUnion venture received formal approval from the central bank and the National Financial Regulatory Administration. American Express was the first foreign payment network allowed to process local-currency transactions in China, according to the Hangzhou government. Its joint venture received preliminary approval in 2018 before obtaining its clearing license.
Visa’s announcement also included references to relations between Washington and Beijing, alongside its provisions concerning the licensing of payments operations. Its chief executive said the company appreciated the important role of the U.S. and Chinese leadership in pursuing a "constructive and strategically stable" relationship between the countries. Assessing the approval, George Chen of The Asia Group told the Associated Press it could be seen as a "goodwill gesture." Chen linked that description to an expected meeting between Chinese President Xi Jinping and U.S. President Donald Trump. According to the agency, the meeting is expected to take place in November in the Chinese city of Shenzhen, the political context Chen cited when commenting on the regulatory decision.
In the market, Investing reported in its coverage on the day the approval was announced that Visa shares rose 1.4% in premarket trading. The announcement followed the company’s latest fiscal third-quarter results, which showed net revenue of $11.6 billion. That represented a year-on-year increase of 14%, according to the earnings filing submitted to the U.S. Securities and Exchange Commission. Visa attributed revenue growth to higher payment volumes, alongside increased cross-border transaction volumes. The company also listed growth in processed transactions among its performance drivers, with the factors it identified spanning payment activity, cross-border transactions and processing on its network.
Visa’s next regulatory step is to complete preparatory work within 1 year before proceeding to apply to begin operations, according to the Associated Press. The operating application follows the preparatory stage authorized by the People’s Bank of China under its current approval. According to the Jilin provincial government’s financial office, the central bank reviews this application jointly with the National Financial Regulatory Administration. A bank card clearing business license is granted after approval by both bodies, completing the process required to conduct domestic operations. On its financial reporting calendar, Visa plans to announce its fiscal fourth-quarter and fiscal year 2026 results on October 27, 2026. The company said in its investor relations announcement that the results would be released after the market closes that day.