Monday, November 17, 2014

Apple Adds UnionPay Payment Option for App Store Customers

Apple has recently announced that App Store has now linked UnionPay debitor credit cards to Apple IDs as payment option for customers in China.

UnionPay in China is the most popular payment card which will provide App Store customers with the option of simple as well as a convenient way of purchasing their apps and customers could link their Apple ID with UnionPay debit or credit card for purchases.

This is significant for both Apple as well as Chinese customers due to the fact the China UnionPay, which is a bankcard network approved by China’s State Council together with the People’s Bank of China have a virtual monopoly and has issued over 4.5 billion cards in China which is available in all cities as well as in overseas markets.

According to recent fourth quarter reports, China with an estimated 100 million iPhone users is Apple’s most important growth market wherein the company generated around $29.8 billion or16% in net sales in the year 2014. Apple’s senior Vice President of Internet Software and Services, Eddy Cue, states that `the ability to buy apps and make purchases with UnionPay cards has been one of the most requested features from customers in China, which is already the second largest market for app downloads and provision is made for users with an incredible convenient way to purchase favourite app with just one tap’.

UnionPay – Bankcard Network 

China UnionPay, as a bankcard network, functions as China’s national inter-bank clearing as well as settlement system, develops UnionPay card acceptance network worldwide, promotes issuance and usage of the UnionPay card and other innovative payment option in order to provide quality, safe payment and efficient services to cardholders.

This network has been extended to all cities as well as rural areas in China. Beside China UnionPay has also helped UnionPay card acceptance in more than 140 countries as well as regions by extensive cooperation with over 400 institutions across the globe. It is also the only interbank network in mainland China which is linked to ATMs.

As per Government regulations, all ATMs and Chines merchants need to use UnionPay in order to process payments in renminbi and foreign credit card companies such as American Express, MasterCard, Visa, which pays UnionPay, a fee for every transaction. Earlier, customers would make payments on the App Store through their telecom operation such as ChinaMobile, through prepayments, or with their credit cards.

Payment Option for the App Store 

The link between UnionPay and Apple seems to be interesting since it comes after reports that Alipay founded by the Alibaba Group with Apple Pay could be considering in striking a partnership and Alipay-Apple tie up could also provide the Cupertino based company a good leverage against UnionPay which is slow in striking a deal with Apple though rumours have been surfacing that Apple had reached a deal with Chine UnionPay which would probably enable users to make payment with what is now known as Apple Pay. However it has not materialized yet but Apple will now be adding UnionPay as a payment choice for the App Store.

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