Tencent, Visa sign pact on China cross-border payments

Tencent and Visa ↗ 0.74% have signed a memorandum of understanding to work together more closely on cross-border payments, agentic commerce and remittances, Tencent said on Thursday, October 29. The deal comes about two weeks after China's central bank let Visa begin preparing a domestic bank card clearing business. That approval puts the U.S. card network closer to China's domestic payments market after more than four decades of working in the country, CNBC reported.cnbc.com+1

What the agreement covers

The companies plan to make payments easier for travelers coming into and leaving China through TenPay Global, Tencent's cross-border payment platform, and Visa Pay. They will focus on letting travelers pay at participating merchants on both the Weixin Pay and Visa networks, according to Tencent. They also plan to expand work on Visa Direct so more senders overseas can transfer money into the Weixin Pay ecosystem. The two will look at how Visa Intelligent Commerce could support AI agents that help eligible users find and buy goods, Fintech News Singapore reported. Tencent announced the deal at its Global Digital Ecosystem Summit in Shenzhen. The companies did not disclose any financial commitments or a rollout timeline, The Edge Malaysia reported.tencent.com+2

Dowson Tong, CEO of Tencent's Cloud and Smart Industries Group, said the companies "hope to create more seamless commerce experiences for consumers and new opportunities for businesses, both in China and internationally," per CNBC.cnbc.com

A long-awaited regulatory opening

On October 13, Visa announced that the People's Bank of China had approved its Application to Prepare. The approval lets Visa begin formal preparations for a domestic bankcard clearing institution. It is not yet an operating license. Visa has one year to finish its preparations before it can apply to open for business, and the central bank and the top banking regulator will then decide whether to grant a clearing license, Reuters reported. If Visa gets final approval, it would be able to issue yuan-denominated cards, Caixin reported. Visa has offered dual-branded cards in China, with UnionPay processing domestic transactions and Visa handling payments abroad, CNBC noted.investor.visa.com+3

Part of a broader thaw

A Chinese embassy official in Washington called Visa's approval a direct result of the summit between Xi Jinping and Donald Trump, The Star reported. Citigroup ↘ 2.48% also received approval from Chinese securities regulators to set up a wholly owned securities firm in Shanghai, and Tencent's Midas platform has partnered with Mastercard ↗ 0.36%, CNBC reported. Most of the Tencent agreement describes areas to explore rather than live products, and any services must still meet regulatory and data-governance requirements, Finance News International noted.financenewsint.com+2