American Express logo and trading symbol are displayed on a screen at the New York Stock Exchange in New York, US, December 6, 2017. [Photo/Agencies]

The first licensed Sino-foreign bank card clearing institution in China was commercially launched in Hangzhou, Zhejiang province, on Friday, representing a substantial step forward in the development of the payment industry in China.

American Express announced on Friday that its joint venture with Lianlian DigiTech Co Ltd, Express (Hangzhou) Technology Service Company Limited, has entered commercial service in the Chinese mainland.

Express Company received approval in June from the People's Bank of China, the central bank, to clear renminbi transactions in the Chinese mainland. The Express Company network will process transactions charged on American Express branded cards, and it is also compatible with the key mobile wallet players in China.

Since earlier this month, the company has begun operations with its first batch of issuing and acquiring partners, including 16 major banks, three leading mobile wallet players, and seven third-party payments institutions in the Chinese mainland.

"As the first licensed Sino-foreign bank card clearing institution, we are committed to providing differentiated services and value to our partners by bringing the best from American Express and Lianlian and by taking full advantage of our unique capabilities in product management, customer management, and risk and information management," said Walter Liu, CEO of Express Company.

"We look forward to joining hands with our business partners to offer consumers, businesses and merchants strong support to enrich their lives and drive business success," Liu said.

China has accelerated the opening of the domestic financial markets and deepened supply-side structural reform in the financial sector.

The People's Bank of China announced on Feb 11 it had given Mastercard's Chinese joint venture the green light to begin formal preparation to conduct bank card clearing business in China, giving Mastercard access to the country's massive payments market.

Last year, Mastercard set up a joint venture with NetsUnion Clearing Corp, a Chinese clearing house for online payments.

The volume of non-cash payments in China totaled 3,779.49 trillion yuan ($550 trillion) last year, of which the volume of transactions via bank cards was 886.39 trillion yuan, according to the central bank.