Chinese Credit Card Issuer Now World's Biggest
By: Brian O'Connell

NEW YORK (MainStreet) -- Visa is no longer the king of the hill – the global credit card hill, that is. According to the U.K.-based business research group Retail Banking Research, China’s UnionPay is now the largest credit card provider in the world, overtaking its American rivals.

"Several findings stand out," RBR said about its report, "including surpassing a phenomenal 8 billion cards worldwide, a fall in the number of cards in North America and more than 10% growth in the debit and prepaid sectors. The most startling finding, however, is that UnionPay is now the largest payment card scheme in the world, issuing three in every 10 cards worldwide."

The firm adds that Visa (Stock Quote: V) has at least one consolation prize – it remains number one globally in terms of usage and spending, but UnionPay is tops of number of cards issued.

Another caveat to the finding is that most of UnionPay's credit cards are issued in its home base of China (99% of all cards right now), although that could change soon as the firm takes aggressive steps to enter the European and U.S. markets. Here are the relevant market share numbers from the RBR study:

  1. UnionPay – 29.2%
  2. Visa – 28.6%
  3. MasterCard (Stock Quote: MA) – 20.0%

Let’s break down what the news means for card companies and carriers:

For card companies

  • The leap-frog by UnionPay is bad news for both Visa and MasterCard. Now both have another 400-lb. gorilla in the room – besides each other. It comes at a time when U.S. card companies are struggling to find new sources of revenue in the aftermath of the CARD Act and the Dodd-Frank financial reform bill of 2010.
  • For UnionPay, it’s a big feather in its cap, and for China, too.
  • Other U.S. card companies can build assets by partnering with UnionPay and its massive credit card operation. Both NYCE and U.S. Bancorp (Stock Quote: USB) have recently inked agreements to bring UnionPay’s credit card brand into the U.S. Even MasterCard has signed on to accept global e-commerce transactions on UnionPay cards via its international payment system.

For U.S. card users

  • Immediately, the landscape won’t change all that much. Visa and MasterCard both remain the top credit card choices for U.S. consumers. But as UnionPay continues to sign deals to edge into U.S. markets, that landscape could change, especially as China cements its ever-increasing influence on global financial markets.

That’s especially true as more American business owners set up shop overseas, to take advantage of the growing Chinese market. In China, credit card rules are highly favorable to UnionPay, but not to foreign competitors, which face a host of regulations and limits on what they can offer Chinese consumers. But UnionPay faces weaker headwinds here in the U.S., and should soon establish a higher profile in the states.

In the meantime, it’s a Chinese credit card firm – and not Visa or MasterCard – that rules the global credit card roost. And that shouldn’t change anytime soon.

—For more advice on finding the best credit card for you, visit MainStreet’s “Credit Cards” topic page for our latest coverage!

—For more ways to save, spend, invest and borrow, visit

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