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Apple Pay to launch in China early next year

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Apple is planning to bring Apple Pay to China next year, in a bid to expand its reach in the Chinese market.

The Wall Street Journal report that Apple has brokered deals with the four largest state-run banks in China, representing a big step towards launching its contactless payment service there. The company is hoping to launch Apple Pay by the start of China’s Spring holiday on February 8, if it can obtain regulatory approval in time.

China has become a huge market for Apple, with iPhone sales outmatching those in the U.S. last quarter. The company has been rolling out retail stores to help keep up with growing demand, and CEO Tim Cook described bringing Apple Pay to China as a top priority.

According to Engadget, “the market is dominated by state-run transaction processor UnionPay, along with China’s Alibaba and Tencent,” meaning it’s been historically quite difficult for other companies to break into. Visa and MasterCard have struggled in the area, but the popularity of Apple’s iPhone range may help its Pay service get off to a good start.

Apple doesn’t make its Apple Pay profits public, but the company takes a cut of all card transactions – said to be 0.15%. In a market the size of China, that adds up quickly.