The Chinese are spending trillions of dollars on their credit and debit cards, and U.S. companies are finally getting a slice of that giant pie.
China announced Wednesday that foreign companies like Visa, MasterCard and American Express can bring their payment processing networks into that country, starting June 1.
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The news sent shares of Visa and MasterCard soaring.
The Chinese payment industry is massive, and up until this announcement, was closed off to foreign-owned companies.
While foreigners or locals in the world's second-largest economy could use their Visa or MasterCard, the companies were charged a fee by a government-approved company called UnionPay to process transactions. Chinese Visas or MasterCards had to be co-branded with UnionPay.
Customers in China spent $5.2 trillion on UnionPay's network in 2013, according to China's Central Bank, up 48 percent from the year before. By comparison, Visa handled $6.9 trillion in transactions on its global network in the same year.
"China obviously represents a massive opportunity for the networks ... and one that the networks have been attempting to access for years," Keefe, Bruyette & Woods analyst Sanjay Sakhrani said.
Visa, MasterCard and American Express now will be allowed to set up their own networks in China through a subsidiary, China's State Council said. The move is an effort to "promote healthy competition in the country's bankcard clearing market," the regulator said.
China's payment industry has been a sore spot between the U.S. and that country for some time. The World Trade Organization ruled in 2012 that UnionPay was effectively a government-sanctioned monopoly.
Payment processors make most of their money by charging a small fee on every transaction in their networks. Access to China's growing market could generate a significant amount of new revenue for Visa, MasterCard and American Express, once they establish a presence there.
"We are hopeful these new regulations will permit additional participants in the Chinese domestic market," said Visa spokesman Paul Cohen.
MasterCard said China's announcement was a "step in the right direction."
Visa's stock jumped $2.86, or 4 percent, to $68.21 in afternoon trading and MasterCard rose $3.73, also 4 percent, to $91.50.