A smart move from Planet Payment, a small US company that specialises in payment processing. While paying with plastic is taken for granted in the west, it ain't so easy in China, which could come as a shock to the growing numbers of credit card-toting foreign visitors.
London-listed Planet Payment quotes official statistics showing that over 20m foreigners visited China in 2005, an increase of 20% over 2004. This number is expected to increase dramatically in 2008 when China hosts the Olympics. In addition, the growing number of multinational hotel chains and luxury retailers installed in China use credit cards as their primary payment method.
Spotting a need in the market, Planet Payment has incorporated a local Chinese company and opened offices in Shanghai and Beijing to provide technology consulting and managed services to Chinese companies involved in the credit card industry. It will also support Chinese credit card acquirers in their activities with domestic Chinese merchants.
Credit card companies see China as one of the most attractive new markets, not least because of the growth in consumer spending. Mastercard for example, predicts Chinese shoppers will spend over $527bn in the first half of 2007, a 12% rise on the year-earlier period.