Uphold partners with UnionPay to tap into China’s $7 trillion bank card market

Launched as BitReserve in 2014, Uphold is one of the planet’s fastest growing cloud-based financial services platforms. Headquartered in Charleston, South Carolina with operations in London, Los Angeles, Portland, Braga, Shanghai, Mumbai, Mexico City, Sao Paulo and San Francisco. The company currently claims to have facilitated over US$690 million in transactions, from tens of thousands of members across 170 countries in 25 supported currencies.

Bitcoin is one of the currencies members can hold, alongside the US Dollar, Chinese Yuan, UK Pound, Japanese Yen, and Hong Kong dollar. Four precious metals are also supported, gold, silver, platinum and palladium.

The company recently announced the addition of China’s UnionPay, the only Yuan-denominated bank card and a state-controlled subsidiary of the People’s Republic of China (PRC).

“We’re launching another ‘World’s first’ for being the first U.S.-based financial services company to successfully provide and operate services in Greater China and Hong Kong since the country opened its $7 trillion bank card market to foreign players on June 1, 2015.”
— – Anthony Watson, Uphold President and CEO

Following the take-off of China’s economy and the shift in its population’s consumption patterns, UnionPay has become the third-largest international bank card brand by its issued card base, in just 13 years. In the first quarter of 2015 UnionPay’s total transaction value exceeded USD$1.9 trillion, becoming the biggest card liquidation organization in the world and surpassing VISA for the first time. The total transaction value of VISA was USD$1.75 trillion in the same period.

“The cumulative number of UnionPay cards issued globally has exceeded 5 billion and UnionPay has become Chinese residents’ preferred payment brand.”
— – Ge Huayong, China UnionPay Chairman

All domestically issued Chinese cards are UnionPay, with the vast majority being single-branded and only a small portion co-branded. UnionPay is accepted everywhere that can take cards in China, and most places in Hong Kong and Macau.

Visa and MasterCard currently piggyback their services on UnionPay’s network when accepting yuan payments, and have to pay network access fees. However,  foreign firms are now allowed to set up their own clearing companies, although they need to apply to the central bank for licenses.

A report by the Institute of Chartered Accountants in England and Wales (ICAEW) on Greater Chinese economic insight states that China’s economy has experienced unprecedented growth, expanding 10% per year on average. ICAEW asserted that China is on track to surpass the US as the world’s largest economy, but according to the International Monetary Fund (IMF), China is already the world’s largest economy by Purchasing Power Parity (PPP).

The China Internet Network Information Center (CNNIC) published that as of June 2015, there were 668 million internet users in China and 594 million mobile phone users.

Through the use of Uphold’s API, “Uphold Connect,” individuals, businesses, and charities in Greater China and Hong Kong can bridge the financial services gap, therefore avoiding the significant costs. They can create applications, products, and services that accept UnionPay, as well as the existing options that UpHold offers such as ACH and SEPA, which allow direct and convenient bank access in the United States and Europe typically.

Uphold members can use their China UnionPay cards to load funds to their Uphold wallet, applying cloud functionality to their money. By holding money in the cloud, users can exchange it, transfer it, and even send funds internationally, both instantly and for free.

“Uphold is a membership service. By becoming a member, you gain access to innovative functionality and benefit from enormous savings in cost and time on our secure, compliant and transparent platform. Membership is free and available worldwide.”
— – Uphold

UnionPay customers need to have a Chinese Passport or Chinese National ID card in order to open an Uphold account and become a verified member. While transfers between Uphold members are free, the company makes money by charging a 3.8% fee to fund account(s) with China UnionPay.

Making the financial lives of Uphold members “easy” has been Watson’s singular focus since he became the company’s CEO in June 2015. “Our vision is to enable anyone, anywhere to move, hold, convert and transact any type of money or commodity, instantly, securely and for free in the cloud,” Watson states. Having worked in the legacy banking and financial services industry for many years, he claims that “easy” is not something legacy banking can offer.

Following the acceptance of UnionPay, UpHold says that they are immediately gearing up for a new line of “game-changing” new products, currencies, service offerings, mobile applications, payment methods, and other options all within the next few weeks.

“China UnionPay is an ideal channel to bring cloud money services to the Chinese people […] I’m deeply proud that we are partnering with China UnionPay, the largest bank card association in China.”
— – Watson

With more than 1.4 billion people in China 276 million in the mobile payment sector, and 270 million in total mobile e-commerce users, online transactions are booming in China. “The opportunities are immense,” said Watson, while stating  that people use smartphones for everything including paying for taxis, meals and shopping at retail stores.