Apple has announced that it is planning to launch its payment service in China, possibly as early as sometime next year. The move will put Apple in competition with Chinese companies Alibaba and Tencent.
Apple is planning to form a partnership with the country’s primary bank card and payment company UnionPay, which is controlled by the Chinese government. UnionPay has a monopoly on all yuan payment cards that are issued and used throughout China.
Apple Pay will be in direct competition with Tencent’s WeChat Payment system and AliPay of Alibaba as payment services within China. The payment services industry in China has blossomed in recent years.
The senior vice president of internet software and services for China Eddy Cue has said that the agreement with UnionPay and leading Chinese banks should help Apple Pay provide Chinese shoppers with a payment option that is convenient, private and secure.
Cue said, “China is an extremely important market for Apple.”
China is the second largest economy in the world, and it is an extremely important market for Apple iPhone and iPad products. However, until now, the company has largely avoided getting involved in the country’s online payments industry.
China has experienced a major increase in online transactions in recent years. This increase is largely the result of smartphones becoming widespread throughout the country. Chinese citizens now use their smartphones to pay for everything from taxis to food at grocery stores.
Earlier this year in July, the country proposed new regulations that would be designed to adjust the online payment services sector. The new regulators would have allowed payment services companies to obtain profits by charging various transaction fees.
In other news, UnionPay said in a statement on Friday that the company is soon planning to reach an agreement with Samsung. UnionPay reportedly wants to make use of the company’s payment system, Samsung Pay, which was launched earlier this year.