Australian Banking & Finance  2015/6/12

UnionPay International’s deal with Australia New Zealand Banking Group - whereby ANZ  introduces QuickPass to its EFTPOS terminals -  is a precursor to a wider drive 

by the Chinese card scheme to become the latest disrupting force in the payments market.

ANZ said it was the the first bank to introduce contactless technology to its EFTPOS machines in Australia and New Zealand for UnionPay International's five billion 

cardholders.

UnionPay International, a subsidiary of China UnionPay - the state-owned payments clearing network that has a near monopoly within China and increasingly competes with 

Visa and MasterCard globally - is fast building relationships with Australia’s mainstream banks.

Although ANZ is the first local bank to launch UnionPay’s QuickPass, Cai Jianbo, chief executive of UnionPay International, said all big four big banks have signed up 

with China's credit card monopoly and nearly half of the merchants can accept its cards.

“We are aiming to finalise rolling out by the end of 2016 with big four Aussie banks," he said yesterday.

"We are talking to the banks promoting the cross- border application of innovative UnionPay products and services in a bid to expand the acceptance of QuickPass, 

improve card-using services and provide UnionPay cardholders with payment experiences that are both secure and convenient."

Threat to new entrants

Cai is also talks with with other potential partners about issuing UnionPay cards to customers.

Currently Australian consumers can apply for cards from the Bank of China. 

China UnionPay -  a settlement created by Beijing's central bank and now owned by 85 state-owned banks - is bigger in China than Visa and MasterCard are globally, and 

could be a massive disrupter in the space, industry sources claimed.

The Chinese card scheme’s move to introduce UnionPay QuickPass technology to US and Europe could crush the ambitions of new entrants like Apple Pay and change how we 

view MasterCard and Visa, sources said.

UnionPay is the leading card network throughout China, with more than 50 per cent of all cards in circulation.

It is also the only card network that issues, clears and settles in Yuan. As a payment network it ranks second globally, in terms of transaction volume, and third in 

terms of acceptance footprint. 

Expanded footprint

Cai said the partnership with ANZ  would dramatically expand the UnionPay card acceptance footprint in Australia and New Zealand ahead of introducing products and 

services that are specifically tailored for the needs of local markets.

UnionPay has enabled card acceptance in150 countries and regions outside the Chinese mainland, with issuance in 40 countries and regions.

Cards have been accepted by over 26 million merchants and 1.8 million ATMs around the world.

QuickPass is growing rapidly in Northeast Asia and later this year cardholders will be able to start making payments with their mobile phones, Cai explained.

Until the announcement of yesterday's deal, ANZ lagged its rivals in allowing UnionPay card-holders to access its ATM and merchant network in Australia. 

National Australia Bank and Commonwealth Bank of Australia already have agreements with UnionPay, allowing Chinese cardholders to spend cash with merchants on their 

networks. 

At the same time that UnionPay looks to challenge Visa and MasterCard outside China, the global card schemes have been given the green light to access the domestic 

Chinese payments market.