China’s UnionPay has overtaken major international credit card brands to become the most-used foreign card in South Korea.
The ascendancy has been largely driven by a boom in Chinese tourism into Korea, but UnionPay says the achievement is giving the brand an increasing say in the global market.
Bomee Sheng, GM of UnionPay International South Korea, said UnionPay cards have occupied approximately 40 per cent of the market share in foreign tourist spending in South Korea, ranking No 1, according to a report by Reuters reporter Lin Qi.
This year, the market share of UnionPay International in South Korea is expected to exceed the total of all other foreign card brands, the report said.
About 90 per cent of the spending by Chinese tourists in South Korea is through UnionPay cards.
The Chinese people’s rapidly rising overseas purchasing power has provided great support to UnionPay International in its expansion in overseas markets. But that is not necessarily the only factor that drives UnionPay to surpass its competitors, convenient overseas card using environment is also a must.
“Purchasing power is right there, if we failed to prepare in advance, the market share would have been grabbed by other card brands,” said Sheng.
In South Korea, UnionPay credit cards can be used at almost all signature-based merchants and more than half of the ATMs in South Korea allow KRW cash withdrawal with UnionPay cards. The transaction volume of UnionPay merchants in South Korea is increasing at an annual rate of 100 per cent.
Hong Kong and Macao were the first destinations in UnionPay International’s efforts to expand to the overseas markets and have now become one of the most rapidly developing regions outside the Chinese mainland.
Carlson Li, GM of UnionPay International Hong Kong, said it is essential for the company to build a solid foundation it is is to become an international card brand.
“Our foundation originates from the high-speed growth of the Chinese economy in the past 30 years and the rapid growth of Chinese people’s income,” he said.
Thanks to the huge overseas spending of Chinese tourists, UnionPay International is having more say in negotiating with merchants and enjoys more preferential policies than other card brands.
Apart from improving card using environment in hot tourist destinations for Chinese tourists, UnionPay International also assisted other countries and regions with their bank card infrastructure construction, providing them payment technology and standards to expand its global presence.
