According to Shanghai Mobile analyst Frank Hill, Apple has reached a deal with mobile payment provider China UnionPay that would enable the next iPhone to make purchases at millions of supported Chinese point-of-sale devices. This would work in conjunction with NFC hardware said to be included in the next iPhone model.

UnionPay works with many of China’s major banks, and is the only domestic mobile payment company operating in the country. Several banks have reportedly been invited by UnionPay to participate in the development of a new system that is compatible with iOS devices.

While rumors of NFC in the iPhone have been relatively rare compared to some previous upgrade cycles, this isn’t the first time this year we’ve seen mentions of the technology finally making its way into Apple’s smartphone. Last month a report from analyst Ming-Chi Kuo indicated that we’d see near-field communication in the upcoming device.

A patent filing uncovered in January also indicates that Apple is planning some sort of iPhone-centric payment system. A job listing posted on Apple’s website near the end of last year hinted that the company was looking for mobile payment developers. Though the company claims this is for new EasyPay systems that will be used in its retail stores, the same developers could be working on consumer-facing iOS payment software.

Going back to the China UnionPay deal, Hill states that users will be able to use special cards in the iPhone’s native Passbook application to facilitate NFC payments. Unfortunately there’s no word about any deal with mobile payment providers in the United States just yet.

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