UnionPay

UnionPay International (UPI) is a subsidiary of China UnionPay and is focused on growing and supporting UnionPay's global business outside of China. In partnership with more than 1,000 financial institutions worldwide, UPI provides the ability to use cards to pay for goods, services and cash withdrawals in 160 countries worldwide. UnionPay cards are issued in more than 40 countries, including Russia. UPI provides high-quality, cost-effective, and secure cross-border payment services to the world's largest cardholder customer base, providing convenient local services to the rapidly growing number of global UnionPay cardholders and trade and service businesses.

Chinese payment system UnionPay International (UPI) is the largest and one of the most dynamic systems in recent years, striving to take a leading position in the banking market. Russia UPI PS cards have all the advantages of world payment systems, they are convenient for paying for goods and services, withdrawing cash, and allow you to convert rubles into yuan and other currencies on favorable terms.

Main article: Payment systems

Business in Russia

In Russia, UnionPay LLC was registered by the Bank of Russia as the operator of the Chinese payment system in the fall of 2013. At that time, its settlement center was Bank of China (Elos).

2023

Revenue growth by 29% to RUB 278.7 mln

The revenue of the Russian subsidiary UnionPay for 2023 increased by 29% and reached 278.7 million rubles. The net profit of Unionpei LLC increased by 16.8%, to 103.4 million rubles. Such data in accordance with Russian accounting standards (RAS) were published at the end of March 2024.

According to Interfax, citing materials from Unionpei LLC, the company's revenue from technical support services in 2023 amounted to 140.4 million rubles, an increase of 35.8% compared to a year ago in 103.4 million rubles. Revenues from clearing more than doubled - to 32.5 million rubles from 14.2 million rubles in 2022.

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The cost of sales in terms of costs at Unionpei LLC at the end of 2023 increased by 25.1% on an annualized basis - 172.4 million rubles from 137.8 million rubles in 2022. The largest increase in expenses software was 1.5 times, to 69.3 million rubles. Advertising costs increased 1.4 times, to 22.9 million rubles, while in 2022 they were measured at 16.5 million rubles. Clearing costs increased by 28.6%, to 15.3 million rubles against 11.9 million rubles in 2022.

Profit from the company's sales in 2023 increased 1.8 times, to 50.3 million rubles. Management expenses in 2023 increased by 12.2%, to 55.9 million rubles. Other expenses in 2023 decreased by 23.7%, to 98.2 million rubles. The volume of assets of the Russian subsidiary UnionPay in 2023 increased by 9.5%, to 398.5 million rubles.

It also follows from the company's reports that by the end of 2023, Unionpei LLC employed 15 people, which is one more employee than a year earlier.

As of the end of 2023, UnionPay is the only international payment system that continues to operate in Russia. It provides the ability to use cards in 183 countries around the world. However, UnionPay does not work with banks that have come under blocking sanctions.^[1]

Issue of joint cards with Tinkoff Bank

On May 23, 2023, Tinkoff Bank began issuing UnionPay multicurrency cards, which will operate in many countries of the world. The release of physical cards will be paid (it can be made using the support service or independently through the application), the cost will be 1000 rubles. At the same time, users have the opportunity to order a virtual card, it will be free. Read more here.

2022

UnionPay overtakes Visa in share of debit card transactions

China's UnionPay overtook Visa in the share of debit card transactions - 40.03% against 38.78% in 2022. In 2011, Visa's share was more than 80%.

Revenue of the Russian subsidiary UnionPay fell by 20%

After leaving in March 2022 payment systems Visa MasterCard and from, UnionPay was Russia expected maps the Chinese to be an alternative for payments abroad. However, despite this, the revenue of the Russian subsidiary of UnionPay - UnionPay LLC - according to RAS in 2022 decreased by 20% compared to 2021 and amounted to 216 million. This was rubles announced on April 19, 2023 by "" with Interfax reference to the company's reports.

Photo: vm.ru/shutterstock

In turn, the profit of UnionPay before tax decreased by 10%, to 35.2 million rubles. Cost of sales in terms of costs decreased by 14%, to 138 million rubles.

As previously reported Kommersant with reference to respondents who Russian banks issue such cards to their customers, in 2022 the volume of UnionPay cards issued by them and the turnover on them increased several times. At the same time, according to Russian bankers, more than 90% of all transactions on these cards occur outside of Russia. At the same time, cards UnionPay's share in the total number of cards in Russia did not exceed several percent.

As of April 2023, UnionPay is the only international payment system that operates in Russia. However, UnionPay does not work with banks that have come under blocking sanctions. In addition, all transactions to pay and withdraw cash abroad in local currency are converted through the yuan.

As noted, a number of Russian banks offer Russians to open UnionPay cards for travel abroad and the possibility of paying for goods abroad. However, the opening and maintenance of such cards is more expensive than the usual offers of banks. In addition, some users often complained that it is not possible to pay with UnionPay cards everywhere.^[2]

Restriction on cash withdrawals abroad for cards of Russian banks up to 500 thousand rubles. per day and 5 million rubles. in year

The Chinese payment system Union Pay in December 2022 limited cash withdrawals abroad on its cards issued by Russian banks.

Now the holders of these cards will be able to withdraw no more than 50 thousand yuan (about 500 thousand rubles at the Central Bank exchange rate as of December 29) per day or the equivalent of this amount in other currencies, as well as no more than 500 thousand yuan per year or the equivalent of this amount in other currencies.

UnionPay cards are used by only 2% of Russians

As of December 2022, only 2% of Russians use Chinese UnionPay cards.

Restriction of work with Russian banks under US sanctions

In August 2022, the Chinese payment system UnionPay limited work with Russian acquiring banks, which are under the sanctions of Western countries: it imposed a ban on servicing its cards issued by foreign banks in their POS terminals. RBC was told about this by two sources in banks and an interlocutor in the payment market.

According to an interlocutor in a large bank, UnionPay could make such a decision due to fear of secondary sanctions from the United States.

Blocking payments with cards issued in Russia

Many foreign stores and their acquiring banks in April 2022 cut off any payments from cards issued in the Russian Federation, including UnionPay. The system itself could influence this situation by requiring local acquirers to fulfill their obligations. But UnionPay prefers not to interfere.

History

2022: Negative experience of use abroad in Russia

Hopes for the work of the Chinese payment card Union pay abroad in Russia in mid-March 2022 are not yet justified. In many cases, she fails to pay for foreign purchases. It does not work everywhere, even despite the presence of a logo.

Withdrawing cash with a high degree of probability will also not work, sometimes it is not even possible to make an internal Russian transfer between banks to it. Plus, there is also a triple conversion through the ruble-yuan-dollar/euro.

2020: UnionPay is now supported by Terminal Technologies payment terminals

On December 14, 2020, the Terminal Technologies Group of Companies announced that it had passed certification of the UnionPay Chinese payment system. Read more here.

2018: UnionPay remains the largest payment system in the world

RBR research shows that the number of payment cards in circulation in the world reached 15 billion by the end of 2017, with UnionPay^[3] still the largest^[4].

Global Card Issue Market Structure by Payment Systems 2017

According to the latest report of RBR "Global Payment Cards Data and Forecasts to 2023," at the end of 2017 the total number of payment cards in circulation in the global market reached 15 billion, which is 6% more than at the end of 2016. As the state and central banks in fluttering countries continue to expand access to financial services, the number of cards continues to grow, opening up additional opportunities for card systems.

The growth of the Chinese card market has been observed for several years. This trend continued in 2017: the number of cards issued in the country increased by 9%. The bulk of the card issue is provided by UnionPay. In 2017, this payment system accounted for 44% of the total number of payment cards in the world, that is, one percentage point more than in the previous year.

Shares of Visa (including Visa Electron, V PAY and Interlink) and Mastercard (including Maestro and Mastercard Electronic) account for 21% and 16% of the total number of cards in the world, respectively; if China is excluded from the calculations, then the share of Visa will be 36%, and Mastercard - 27%.

The share of domestic payment systems characteristic of the debit product sector is decreasing in most markets, since they either issue cards in cobaging with international systems, or their cards are replaced by MPS cards. However, in recent years, a number of large markets have seen something similar to the renaissance of national payment systems. For example, thanks to the important role played by the Indian RuPay during the campaign to reach the population with financial services, the share of its cards in the country has grown to 49% since its launch in 2012.

2017: UnionPay overtakes Visa and Mastercard in global payment card market

80% of all cards in the world are served by UnionPay, Visa and Mastercard payment systems. The largest share now belongs to UnionPay. Following the data of the RBR Global Payment Cards Data and Forecasts report, China's card market will continue to grow rapidly by 2022, which helped UnionPay's expansion. The system in 2016 increased its market share to 43%, overtaking Visa and Mastercard. UnionPay became the largest global payment system in the card market between 2010 and 2016 and now has more than 6 billion UnionPay cards in circulation.

According to the latest RBR report, 1 billion cards were issued in just a year. And the volume around the world grew by 8% in 2016 and reached 14 billion units. The market is growing fastest in the Asia-Pacific region. Among the countries, China made the greatest contribution to the development of the card market.

By 2022, the volume of available cards worldwide will reach 17 billion units, the growth will be especially noticeable in the Asia-Pacific region, the Middle East and Africa, and this despite the fact that many people do not have cards at all.

2015: UnionPay overtakes Visa in terms of card payments

UnionPay, which became the world's largest payment system in terms of the number of cards in 2010, overtook Visa in 2015 in terms of card payments (according to RBR's analytical review Global Payment Cards Data and Forecasts to 2021) ^[5].

In 2015, the number of payment cards in the world increased by 8%, reaching 13 billion. The most significant growth in 2015 was seen in the Middle East, Africa and the Asia-Pacific region, where the number of cards rose by 13% and 10%, respectively, driven in particular by financial inclusion initiatives.

UnionPay, Visa and Mastercard account for 89% of global payment card spending

According to the RBR report, UnionPay is the largest payment system in terms of card payments: it accounts for 37% of the global spending of $21.6 trillion. USA in 2015 (in 2014 - 32%), overtaking Visa (32%) and Mastercard (20%).

In terms of the number of cards, UnionPay is the largest payment system since 2010, and by the end of 2015, the issue of UnionPay brand cards grew to 5.3 billion cards, which is 41% of the total number of cards in the world.

UnionPay, Visa and Mastercard account for 89% of global card spending, the remaining 11% are American Express, Diners Club and JCB, Discover T&E cards, national and local payment cards and cards issued by large retail chains under their own brands.

However, there are significant differences at the regional and country levels: for example, only local card systems operate in Iran, which was the result of international sanctions, and JCB accounts for 22% of domestic spending. Japan

UnionPay's growth is impressive, but it was the result of an exceptionally rapid expansion of the Chinese market. UnionPay remains a predominantly local system, outside of China, the share of spending on its cards is only 0.5%, while Visa and Mastercard hold an impressive 50% and 31%, respectively.

2014: UnionPay cards were served in 140 countries

According to information for 2014, UnionPay payment system cards were served in 140 countries of the world, and 4.5 billion cards were issued by payment system participants.