China Mobile confirms purchase of stake in Shanghai Pudong Development Bank

By Sarah Clark • nfcworld.com • 10 March 2010, 15:23

China Mobile has agreed to pay $5.8 billion for a 20% stake in Shanghai Pudong Development Bank (SPD Bank), making the mobile network operator the second largest shareholder in the bank.

Shareholders in China Mobile have not greeted the idea with much enthusiasm, however, and since it first revealed its interest in the bank, the operator's shares have fallen by 3%, according to Reuters.

"The co-operation between China Mobile and SPD Bank signifies the aspiration of a closer integration between mobile communication and e-commerce applications," Wang Jianzhou, chairman of China Mobile, revealed in a statement.

The cooperation is expected to include the joint development of mobile phone-based payments, bank card and funds transfer services, the statement continued.

The stake gives China Mobile's new RF SIM-based mobile payments service a foothold in the banking services sector. It follows SK Telekom's purchase of a 49% stake in Korean card issuer Hana Card and China Unicom's move to launch a commercial NFC service in Shanghai — and is part of a trend that we expect to become widespread as banks and mobile network operators move towards the commercial deployment of NFC and mobile contactless payments services.

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