China’s UnionPay Issues More Than 200M Digital Cards

UnionPay said it has issued more than 200 million cards outside the Chinese mainland.

The Shanghai-based card acceptance company announced the milestone Friday (Dec. 30), marking its tenth year in operation.

“During these ten years, the digital transformation of the global payments industry has developed rapidly, and UPI has accelerated product iterations and service upgrades to meet the ever-changing payment habits of international customers,” the company said in a news release.

UnionPay said 38 million merchants outside of the Chinese mainland accept UnionPay cards, with four million added just this year, while 22 million online merchants use the company for their payment needs.

In addition, more than 20 million UnionPay cards have been issued worldwide since the start of 2022, with one in four newly issued bank cards in the Asia-Pacific region (APAC) from UnionPay. The company said it now accounts for 95% of debit cards in Hong Kong and Macau.

As PYMNTS wrote recently, expansion into the APAC region remains difficult because eCommerce merchants don’t offer local payment methods.

This much was obvious in the new study “The Emerging APAC Opportunity: Local Payment Methods Edition,” a PYMNTS and Citcon collaboration. The 500 executives we surveyed said lackluster localization is aggravating cart abandonment rates, while 41% of companies that sell to APAC without localized payment options say cart abandonment rates surpassed 60%.

Compare this to the merchants selling in the APAC region and providing local payment methods, whose cart abandonment rates fall to 32%.

According to Wei Jiang, Citcon’s president and COO, this is a matter of market perspective, as businesses from the West wrongly assume European and North American card networks work just as well in APAC.

As Jiang told PYMNTS, “many of the companies made decisions based on their own experience. For people who live in the U.S., Canada and the U.K., payments are largely dominated by Visa, Mastercard and global card schemes.”

Continued Jiang: “It can be hard to understand that people in APAC countries and many countries don’t really use or have access to global card schemes. From that standpoint, it is harder to understand how big the obstacle is.”

The study determined that not only is the use of local APAC payments low at 13%, but only 1.8% of eCommerce players even recognize that APAC shoppers would rather use local payments denominated in local currencies.