US-based American Express on Saturday announced that its China-based joint-venture Express Company has received approval from China’s central bank for a network clearing license, becoming the first foreign payment network to be licensed to clear transactions of Chinese currency, the yuan, in the Chinese mainland amid the accelerating China-US financial conflict.
Express Co, a joint venture of American Express with a Chinese fintech services company Lianlian DigiTech Co, is expected to begin processing transactions later this year, according to a statement sent to the Global Times by American Express on Saturday.
Express Co has built a network to clear domestic transactions charged on American Express branded cards, and is also compatible with the key mobile wallet players in China, read the statement.
This is another demonstration of China expanding the opening-up of its financial industry and deepened reform of the financial supply side, which is conducive to improve China’s payment and settlement services and the yuan’s internationalization, as well as providing diversified and differentiated payment services for consumers, said an online statement from the People’s Bank of China (PBC), China’s central bank.
The US, under the leadership of the Trump administration, has been instigating anti-globalization and decoupling with China, putting firms under huge political pressure. However, American firms from different industries have not stopped their exploration in China, such as Honeywell, Tesla, and financial firm Fitch Ratings.
China’s opening-up is a clear and unswerving strategy which has been promoted steadily and won’t be distracted by any external disturbances, no matter if it’s the China-US trade war or a financial war that the US intends to initiate, Zhao Xijun, vice president of the School of Finance at the Renmin University of China, told the Global Times on Saturday.
As the US has been beating the drum of decoupling with China, including financial sectors, Zhao noted that financial firms across the world have a fundamental need to expand their market and earn profits. Any political move trying to hinder these firms’ development in China, a promising financial market, goes against the commercial principles of these companies.
“Foreign firms will not give up on the huge Chinese market, unless they were not competitive enough,” Zhao said.
Per the PBC statement, China will continue to promote the business entry work of the bank card industry in an orderly manner based on the principles of openness, fairness and justice, and in accordance with the law. It will continue to improve the post-access supervision system, while effectively maintaining financial stability.
Fitch Ratings, a US-based rating agency, has been granted access to China’s credit rating market via its wholly owned subsidiary, the central bank announced in May.
Chip credit cards of American Express Co Photo: VCG
