Joint Bankcards Banned by PBC, Making Room for Bitcoin Virtual Card?

Last week’s rumor turns out to be true: all dual-network cards, a credit card bearing logos of Unionpay plus VISA or Mastercard, will be banned by the People’s Bank of China (PBC) as per various media report in China, including CCTV.

According to the new rule, transactions conducted by foreign bankcard associations that have not acquired domestic bankcard clearing licenses should be denominated in foreign currencies, and any of their transactions that were conducted within the Chinese border will be considered illegal.-Global Times


The joint-card was issued in China around 2003 with the mutual efforts of Unionpay and foreign bank associations like Mastercard and VISA as an expedient measure. A common Chinese may use this card to pay abroad at home via Unionpay channel and abroad via international channel. As per the BIN number allocation, VISA card starts with “4”and “5” goes to Mastercard. “62” was granted to the China Unionpay by ISO in 2004. But the dual-network card usually starts with foreign bankcard code and looks like this:

Joint Credit-Mastercard Card sample 

As per yicai, the number of valid dual-card is around 200 million and the single-network card (with VISA or Mastercard logo only)is less than 10 million. Around 500 million Unionpay card are in circulation. The joint-cards in use will phase out when they expire and single-network card will be issued.

Bitcoin virtual card provider like Xapo,e-coin, holytransaction, wirex, coinzy have been around for quite a while.Unlike credit card, these virtual cards often requires deposit of certain amount of bitcoins to the designated address to be functional.

Wences Casares, CEO of XAPO is not aware of the news and therefore unable to comment:

I am not familiar with the ban of the joint credit card in China.

Will the ban of dual-card makes room for bitcoin payment or bitcoin virtual card?

“Not likely! “

said Shiliang Huang, a bitcoin analyst in China. ” Bitcoin payment is no-winner against the incumbent payment system like Unionpay or Alipay in China.”

No more joint Unionpay-Visa cards. Is it a step backward for RMB internationalization?

Ye Tan, a famous financial analyst known for her sharp comments, concludes:

Mastercards and the likes are basically deprecated.

The purpose is clear: a nationwide credit and identification system is established to review all outflow capital. As long as the money stay at home, everything is negotiable.

Maybe curbing the outflow of USD is of better priority or the “internationalization” is happening somewhere else.

However, one thing that interest me is that a small local government portal  released a short article, saying that the China Unionpay has reached agreement with Russian Bankcard Payment system(NPCS)on issuing joint-cards on 29th Sep, 2016.

Agreement reached between China Unionpay and Russia NPCS to issue joint cards

Banning one joint card and allow another?  Maybe it’s just the beginning of more measures to control capital outflow.

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