Shares of Visa Inc and Mastercard Inc were green in the today’s trading session. It seems that investors are happy with news that China is allowing the U.S. card companies to enter the trillion dollar card market. Visa’s stock rose as much as 1.30%, while Mastercard’s shares gained as much as 1.32% on Wednesday. A report by Reuters suggested that Visa Inc and MasterCard will be able work in China under new rules issued on Tuesday. The two payment companies will get opportunity to tap into an $8.4 trillion card payment market.
Visa and Mastercard Could Operate In China
China’s cards market is predicted to become the world’s biggest by 2020. Visa and MasterCard has been lobbying for more than 10 years for direct access to the Chinese market, which is dominated by state-run China UnionPay.
Under the new rules, issued by the China’s central bank and the China Banking Regulatory Commission require, foreign bank and card companies will be required to hold $152.2 million in registered capital in a local company, Reuters says.
“Foreign bank card companies must also meet China’s national security and cyber security standards and be locally based,” says Reuters.
The new rules are welcomed by Visa, MasterCard and UnionPay.
Visa Acquires Visa Europe
California-based Visa is a payments technology company, which has a market cap of $194.87 billion. The company’s stock has gained 4.16% year-to-date.
Recently, the payment company launched the Visa Digital Commerce App, which enables financial institutions to offer their own mobile app to customers. Through the mobile app, issuers can offer services such as real-time account balance information, card controls, alerts that inform account holders about recent transactions or fraud concerns.
Last week, Visa Inc announced that its proposed acquisition of Visa Europe Ltd. was approved by the European Commission. The deal, approved by both the Jersey and the Turkish competition authorities, is expected to close in the company’s fiscal third quarter of 2016.
Last month, Wal-Mart Stores targeted Visa over a payments issue related to chip-enabled cards. The retailer sued the payment company for the right to choose how customers verify debit-card purchases at the checkout counter.
US Bank Partners With MasterCard
Mastercard Inc is a New York-based global payments & technology company. The company has a market cap of $106.18 billion. Year-to-date, the company’s stock has lost 0.89%.
On Wednesday, U.S. Bank announced that its MasterCard card holders can use Android Pay and Samsung Pay. The bank’s consumer and small business MasterCard card holder are now able to load their cards onto eligible Android and Samsung mobile devices and pay using these two mobile payment services. Android Pay and Samsung Pay also work with MasterCard credit cards that U.S. Bank issues on behalf of its co-brand and affinity partners like REI and Edward Jones, according to a statement.
Speaking to EurActiv, Ann Cairns, president of international markets for Mastercard Inc , said that Brexit wouldn’t be a significant change for the company. She added that blockchain is likely to have a larger impact on MasterCard’s business than a potential Brexit. She also believes that the technology behind virtual currencies like Bitcoin is “a good thing for the future.”
MasterCard could be getting ready to team up with social media giants Twitter and Facebook. The purpose of the move would be to start engaging with the social commerce trend, a development that merges social media with e-commerce.