Apple is looking to grow on its recent iPhone dominance in China by launching Apple Pay in the region, however its efforts have hit a snag as China’s central bank, UnionPay bank-card service and e-commerce giant Alibaba have become a struggle to negotiate with, centering mainly around profit sharing, according to MarketWatch.
“Apple is seeking to cooperate with Chinese financial institutions,” a source at the People’s Bank of China confirmed to the publication, however no final/substantial deals have been struck. Another large hurdle is with UnionPay, China’s state-owned credit card and debit card system operator. Sources claim talks over a possible agreement, supposedly due for completion by March, have stalled.
“Letting Apple Pay enter China will have a profound impact” on the payment market, said a financial-sector source. “For UnionPay, cooperating with Apple means opening its settlement system. It would be hard to say who’s in control.” UnionPay reportedly doesn’t want to lose profit or control.
Furthermore, MarketWatch has word that Chinese government officials want Apple to keep all Chinese Apple Pay information stored in a data center in China, to “prevent data leaks”.
Apple Pay is slowly gaining marketshare in the US, the only market it’s currently available in. Several indicators have shown Apple is planning a global launch soon, with parts Europe and Canada in mind.
Launching Apple Pay in China would be a big deal for Apple. Tim Cook, CEO of the electronics giant, has called China one of the most important regions to Apple’s success, also noting at an investor conference last week that the region has “tremendous opportunity”.
Source: MarketWatch