Study Of Unionpay Development Strategy In Revolving Payment Industry

UnionPay is the3rd largest card company in the world, next to Visa and MasterCard. It owns the special clearance right for RBM transactions within China and is the only card organization approved by Chinese government for inter-bank clearance. Prior to the establishment of UnionPay, the whole bankcard industry from card issuance to acceptance, although developed for17years, was in disperse mode, non-compatible, differed by geography. The Chinese society is in orphan stage in term of card usage. As UnionPay entered bankcard industry with a mission of staying connected, China bankcard industry began the journey of integration and mass development and the whole payment industry is now on the fast track. However, due to the new information technology and opening of payment industry policy, UnionPay’s dominant position was threatened by domestic and international strong competitors, the previous business strategy was out of date. It is now the most critical and urgent task for UnionPay to study and develop a new corporate strategy that fits the new environment and open policy.From a modern strategic management perspective, the paper uses analytical tools, such as PEST, Porter’s5Force Model, SWOT to compare UnionPay’s successful business model overseas, domestic and internally with international card company. The paper analyses in-depth the business management capability and competency of UnionPay and discusses Union’s competitive and cooperative relationship with UnionPay; The paper studies the bilateral business nature of payment industry and how to set up effective pricing mechanism and strategy and seek for new growth opportunities; While studying the changing environment of payment industry and its impact, the paper also summarizes the main trend of payment industry evolution; The paper also studies the payment value chain of UnionPay and analyses the need of involving partiies and summarizes the new requirement of UnionPay due to the development of payment industry; Lastly, it outlines the new direction and goals of UnionPay’s development and defines the roadmap for the new strategy and propose the resolutions and tactics of achieving the new development strategy.