Photo: CFP

American Express's China bank card clearing venture is officially up and running since Friday, and is the latest sign of China's financial opening-up despite the US' escalated crackdown on Chinese businesses.

Express (Hangzhou) Technology Services Co, the joint venture between the US card giant and LianLian DigiTech Co, was green-lit by the People's Bank of China (PBC), the country's central bank, in June for a network clearing license. The joint venture, initially approved in 2018, was required to begin the clearing service within six months after gaining the license.

The official nod made American Express the first foreign credit card to offer onshore operations on Chinese mainland.

The PBC expected its granting the licensed to improve the nation's payment and clearing services and the internationalization of the yuan, which is set to provide financial consumers with diversified and differentiated payment services.

American Express's rival Mastercard has also won the central bank's approval to set up its clearing operations in the country, but its China joint venture has yet to be granted a network clearing license.

Card giant Visa, which filed its application to create a bank card clearing institution in the country in 2018, is still awaiting the regulatory approval.

China's opening of its payments market to foreign firms is part of a broad-based push to enable wider access to its financial markets that include securities, insurance and asset management.

The deregulation push stands in stark contrast with the US, which is to ramping up its clampdown on Chinese firms.

In a fresh threatening attempt, the US commerce ministry announced Wednesday the addition of 24 Chinese businesses to the Entity List for South China Sea island building.

"China-US tussles have spilled over into the financial sphere," which has ignited a fresh push by China to globalize its currency, DBS economist Nathan Chow said in a note sent to the Global Times

The yuan has grown as a more attractive investment currency. "While off its 2015 highs, the yuan is now the sixth most used currency in international payments and is used for settling approximately 20 percent of China's trade," according to the economist.

Global Times