Apple Pay in China struggles to win support

UnionPay, the only company that handles interbank payments in the country, was not supported on Apple’s latest operating system (iOS 8.3), which was released on April 9.

According to the source, a UnionPay employee who declined to be named said the company has not reached any agreements with Apple, and no timetable for cooperation has been set.

When Apple sent software developers a test version of the new operating system in February, it said iOS 8.3 would support UnionPay. Apple started talks with UnionPay about using its network last year and hoped that by March it would have an agreement in place that would allow consumers to make payments via their iPhones.

Apple started negotiating with at least eight major Chinese banks last year. The discussions did not go well, a source close to them said, and the Industrial & Commercial Bank of China was not interested in any cooperation.

In the United States, Apple Pay gets 0.15% of the 2% fee paid by merchants for each credit-card payment and half a penny for each debit card payment.

However, Chinese banks argued those charges were too steep, an employee of a large bank said. Many large banks that are already part of mature point-of-sale networks do not want to lose such a large percentage of their profits in a deal with Apple Pay, he said.

Apple has been trying to introduce its mobile-payment system in many regions around the world, especially Europe, the Middle East, India and Africa.