Credit Card Processing Finds Open Doors in China

As most of America wasabsorbed with the

news of the midterm elections and contortions

over infectious disease protections, the AP

reported that China announced that it was

alleviating the strangehold the nation has

exerted on credit cards available to its

residents.

For the rest of the world, as Wesley Yuhn &

ACHDP.com noted, it means that

internationally favorite credit cards are going

to be an option that will encourage people to

purchase goods from businesses outside of China.

Mr. Yuhn reminded his B2B clients that this also opens doors to wholesalers who have been

losing money on the cards issued by the Chinese government.

Foreign corporations will be able to establish credit card processing systems and sell software

that is designed to protect buyers and sellers alike. China is encouraging companies that provide

the software to apply. This is the first time that China has invited outsiders to participate in

access to purchasing power of the Chinese and companies can now get in on the ground floor

right now.

Through the initiated efforts of the World Trade Organization who informed the government in

Beijing almost two years ago that the monopoly that China exercised on credit card services

violated its free trade agreement.

AP stated that the much had to do with the slowing economy in China which reported a

continuation of the downward trend in GDP falling from over 12% in 2012 to 7.1% in the 3rd

quarter of 2014.

In spite of the fact that the consumer market in China has been dragging behind the European

models, the interest in using credit cards instead of cash has grabbed hold of its upwardly mobile

society. The China Banking Association reported 30% increase in card issuance over the

previous year and that more than 13.1 trillion Yuan ($2.1 trillion) was spent using credit cards.

The Communist Party run nation is slow to move away from its idealogy which doesn’t embrace

the open market capitalistic approach believing it will move people into a more secularist view

and the possibility that “the Party” could face opposition from within politically.

But, balancing the economy that now teters on the verge of recession seems to be spurring the

officials to make changes and open at least some of its state-owned financial properties to

foreign companies.

Visa and MasterCard are standing in line already as they continue to smooze the officials who

are in charge of the decisions.