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China UnionPay, the country's largest company managing the payment network, plans to launch pre-paid travel cards for foreign visitors by the end of the year.
Firm representative Zhang Yashuang said yesterday UnionPay is in talks with international partners about marketing the new product and boosting the company's image across the globe.
Holders of UnionPay travel cards can pay for their shopping, dining and travelling expenses in renminbi.
As more merchants display the UnionPay logo than any other brand, holders will be able to make transactions at many different outlets, Zhang said.
Customers will be able to purchase travel cards from UnionPay's overseas partners or at domestic airports, railway stations, tourist attractions and shops.
Between 1999 and 2003, the number of foreign visitors to Beijing increased sharply at an average annual growth rate of 16.4 percent.
Visitors spent 171 billion yuan (US$20.6 billion) in 2003, or 12,370 yuan (US$1,490) each on average.
This spending rate is the highest in the Asia-Pacific region, but only 10 percent of the money was transferred using bank cards, far lower than the average rate of 35 percent elsewhere in the region.
Government departments have set an ambitious target of having more than 60 percent of merchants with sales volumes of at least 1 million yuan (US$121,000) accepting bank cards by 2008 to ensure most key business areas and streets, star restaurants, and important sightseeing areas are covered.
The new travel cards will ease security fears as transactions are carried out solely within domestic networks.
Experts say pre-paid cards are becoming more and more common around the world.
In 2003, Visa and MasterCard issued more than 7.6 million cards with pre-paid funds exceeding US$2 billion.
Branching out abroad
To further expand its network overseas, China UnionPay announced on Tuesday that it had signed agreements with Discover Financial Services in the United States and the Sumitomo Mitsui Card Company (SMCC) in Japan.
The new alliances mean China UnionPay card holders will be able to use their cards in the United States and Japan.
UnionPay extended its reach into the Republic of Korea, Thailand and Singapore in December last year, the first time the firm's cards were used outside the country.
Discover cards can be used at more than 4 million outlets in the United States.
SMCC is the second largest credit card company in Japan, covering more than 3 million merchants.
China UnionPay is also seeking ways to expand its network into Europe and Australia, according to the company.
(China Daily June 2, 2005)
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