Apple Pay China expansion reportedly stalled by ChinaUnion, regulators

We learned last fall that Apple plans to bring Apple Pay to China by partnering with UnionPay. Code found within iOS pointed to Apple preparing its mobile payment service for China while MarketWatch reported Apple was working on a deal with the institution. Several months later, however, MarketWatch now reports that Apple is “struggling with its relationship with UnionPay,” adding that Apple has not yet established an agreement it hoped to reach by March.

The report also describes security concerns from regulators in China over Apple Pay as reasons for its international roll out stalling. Apple’s NFC chip used for Apple Pay may not be compliant with security standards, MarketWatch says, while the Chinese government reportedly told Apple that a mainland China-located data center would be required address security concerns for Apple Pay.

Apple did announce a major partnership with UnionPay last November, though, as the company forged an agreement with UnionPay to support the Chinese institution’s debit and credit cards on the App Store in China for digital purchases.

We also saw Apple CEO Tim Cook tease a potential partnership with China’s Alibaba. The CEO said the two companies would meet to discuss a potential Alipay-Apple Pay tie-up that could bring Apple’s mobile payment service to China. However, MarketWatch’s report says Alipay still needs to work with ChinaUnion’s UnionPay, which controls the NFC payment system in the country. Alipay’s mobile app did adopt support for authenticating payments with Apple’s Touch ID system shortly after those talks.

Apple Pay, which launched in the United States in late October last year, is currently rolling out in waves with just over 60 banks supporting the mobile payment service in the US. In addition to working to bring Apple Pay to iOS users in China, Apple has been working with institutions in Canada, the United Kingdom, and other countries.