Mastercard and Visa are losing market share to UnionPay when it comes to the global cards market. That’s according to new research from RBR, which announced news in a press release late last week that the global card market has increased to 14 billion cards and that UnionPay is becoming the largest payment scheme.
According to RBR, the number of payment cards across the globe jumped 8 percent in 2016 to 14 billion. The fastest-growing market was Asia Pacific, with growth being driven by financial inclusion efforts. China contributed the most in the rise in card numbers. RBR is predicting the number of cards worldwide will hit 17 billion by 2022, led by Asia Pacific, the Middle East and Africa, given many people in those regions still don’t have a payment card.
RBR says UnionPay increased its share of the market to 43 percent last year, extending its lead over both Visa and Mastercard. UnionPay has been the largest scheme globally for cards since 2010, and by the end of last year, more than six billion UnionPay-branded cards existed. The three collectively control 80 percent of the market with American Express, Diners Club and JCB, Discover and domestic-only private label cards making up the rest of the market.
RBR did note that UnionPay is still largely a domestic scheme, with less than 1 percent of its cards issued outside China. It is expanding into new markets, however. The company is likely to face more competition from Visa and Mastercard, both of which are aiming to enter the Chinese market.
“UnionPay may struggle to maintain its high global share once the international schemes obtain domestic licences to operate in China. It will increasingly look to expand its business abroad to counteract competition in its home market,” said RBR’s Daniel Dawson, in the release.