THE bank of East Asia is poised to be the first overseas bank to issue a yuan-backed debit card on the Chinese mainland, sources have revealed.

The Hong Kong-based company has set up a bank card data center in Shenzhen in southern Guangdong Province. The bank is expected to issue debit cards on the mainland as early as next month, said an unidentified senior official from China UnionPay.

BEA has outsourced card issuing with UnionPay's subsidiary, China UnionPay Data, the e-payment outsourcing firm under UnionPay, the source told Shanghai Daily.

UnionPay is the mainland's sole bank card system operator.

The bank has applied to the China Banking Regulatory Commission to issue debit and credit cards, it said earlier.

The bank said it expected to launch its debit card this year but declined to release more details.

Overseas banks, including HSBC, Citigroup and Standard Chartered, have applied to issue yuan-backed bank cards on the mainland.

With bank cards, overseas banks can reach mainland clients beyond their limited network and move a step up to compete with domestic rivals. Bank cards offer income channels, including commission from merchants which accept bank cards.

Authorities have asked overseas banks to shift their bank card data centers to the mainland if they want to issue yuan-backed bank cards on the mainland.

Normally a domestic bank can issue a credit card after it has issued debit cards for three years. It is unknown yet whether the requirement can be lowered on overseas banks.