SHANGHAI (Kyodo) JCB Co. and the Bank of China said Wednesday they will jointly launch a credit card in China in April, marking the first entry by a Japanese company into China's credit-card business.
Under the deal, Bank of China, one of China's four leading commercial banks, will begin issuing credit cards under the brand of Japan's largest credit-card company, the two said in a news conference in Shanghai.
JCB will offer Bank of China rights to issue JCB-brand cards and rights to extend contracts to shops and restaurants as members. It will receive royalties from the bank.
Analysts say that although credit-card holders in China are relatively few and primarily wealthy, accounting for only about 1 percent of the country's population of 1.3 billion, business there has been expanding rapidly. U.S.-brand credit cards, including Visa and MasterCard, are already issued in China.
Targeting the affluent, JCB is in talks with China's other leading commercial banks to conclude similar agreements, with a goal of having more than 5 million holders of its cards in the country by 2010.
Credit-card competition is expected to intensify in China when the county lifts a ban on retail banking business in yuan by foreign banks by the end of next year, five years after China's accession to the World Trade Organization.