Apple inc. -Apple struggling to close a deal in China for Apple Pay

Apple Pay appears headed to China. The release of

the first beta version of iOS 8.3 had Apple Pay

support for China UnionPay. But don't count on

the mobile payment system creating a stir in the

country just yet. An official with the People’s

Bank of China says that Apple has yet to

approach regulators in China about allowing

financial institutions in the country to

participate in the program. Because Apple has yet

to seek out regulatory approval, this official says

"it's unclear whether the product meets the

government's requirements."

Despite the iOS 8.3 beta 1 support for UnionPay,

which is the government run debit and credit

card operator, Apple's relationship with the

outfit is not as close as it would seem to be.

Talks between Apple and UnionPay have hit a

rough patch. Like Apple Pay, UnionPay relies on

NFC for its mobile payment system in China,

which works with a smartphone loaded with a

special China Mobile SIM card. Regulators have

steered clear of the negotiations between Apple

and UnionPay, which both had hoped would be

finished by March. The company has the only NFC

payments network in China.

Apple could decide to strike a deal in China with

Alibaba's Alipay app. The latter uses a QR code

and a fingerprint password developed by Alibaba

and Apple to make a payment. Alipay still uses

UnionPay's NFC network to complete a

transaction. No matter how it is done, Apple Pay

is destined to get into China as the mobile

payment system expands from the U.S. to Canada

and beyond.

source: MarketWatch via MacRumors