(Yicai Global) June 15 -- The People's Bank of China issued a bank card clearing license to American Express' local joint venture, making the firm the first and only overseas payment institution to secure such a grant in China, the PBOC said in a statement on its website on June 13.

American Express and Hangzhou-based fintech services company LianLian DigiTech established Express Hangzhou Technology Services in October 2017. It has registered capital of CNY1 billion (USD141.1 million) and each holds half the JV.

China opened its USD27 trillion market to foreigners in March, Yicai Global reported.

"We are pleased to be the first foreign company to receive this license. This approval represents an important step forward in our long-term growth strategy,” Stephen J. Squeri, chairman and chief executive of American Express, said in a press release yesterday.

The JV may formally begin processing transactions within six months from the date of gaining the license, per regulations.

New York-based American Express released the list of the first batch of cooperative banks, third-party payment institutions and acquirers on its Chinese website. A total of 16 banks, including Industrial and Commercial Bank of China, Agricultural Bank of China, and Bank of China, will serve as cooperative card issuers and acquirers in China.

Three payment platforms NetEase's Yunshanfu, Tencent Financial Technology’s WeChat Pay, and Ant Finance’s Alipay support the forthcoming American Express Chinese yuan card transactions.

An acquiring bank -- also known as acquirer of merchant bank -- is a financial institution that keeps a merchant's bank account. An issuing bank issues credit cards to consumers on behalf of card networks. The acquirer sends funds it receives as payment to the issuer.

Editor: Ben Armour