China Unicom and Bank of Communications announce commercial NFC payments launch

The Chinese bank and mobile network operator are to launch a commercial NFC service that lets consumers make payments with NFC phones supporting the Single Wire Protocol — using a prepaid account that can be topped up over-the-air from the customer’s bank account.

Bocom/Unicom/UnionPay announcement
PARTNERS: China's first SWP-based commercial payment service is announced. Left to right: Liu Fengjun, assistant president, China UnionPay; Dicky P Yip, deputy head of BoCom; He Huajie, deputy general manager of product innovation at China Unicom and Wang Weidong, Bocom's general manager of personal financial services. Click to enlarge.

Bank of Communications (BoCom) and mobile network operator China Unicom, together with bank card association China UnionPay (CUP), announced this week that they are to launch an NFC payments service using handsets supporting the Single Wire Protocol.

The new service will enable China Unicom subscribers to store a prepaid card account on their mobile phones. They will then be able to top up the prepaid account by transferring funds over-the-air from their Bank of Communications bank account.

The announcement was made jointly by representatives of all three companies at Bank of Communications’ OTO Fortune Expo earlier this week. It follows the signing of a strategic cooperation agreement between China Unicom and China UnionPay in November 2009 and the news in February this year that China Unicom would introduce commercial NFC services from the second quarter of this year. In May, meanwhile, eighteen Chinese banks, China UnionPay, China Unicom, China Telecom and a range of handset manufacturers and industry suppliers formed an alliance in a bid to create standards and a business model for the introduction of a single, open platform that can be used by businesses throughout China to offer near field communication and mobile payments services.

Bank of Communications is the first Chinese bank to confirm that it will be offering mobile payments services to its customers using near field communication handsets supporting the Single Wire Protocol. It follows the signing of a partnership agreement between China Unicom and Bank of Communications in April, then the completion of technical testing and a successful field test at the World Expo in Shanghai. The new Pacific Unicom NFC service is a co-branded product and is compatible with China’s PBOC 2.0 bank card standard. It is expected to go live first in Shanghai, and is then expected to expand gradually to other regions. Details of pricing and handset options have not yet been released.

BoCom and China Unicom are both expected to announce additional NFC-based services in the future, while other Chinese banks are set to begin offering NFC services in conjunction with China Unicom in the coming months.

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