Apple notches App Store deal with China's UnionPay

Apple has reached a deal that will allow consumers in China to use the country's most popular payment card to make purchases on its App Store.

The new payment option lets Apple ID users in China link their accounts with UnionPay's debit or credit cards for one-touch purchases of apps, the Cupertino, Calif.-based company announced late Sunday. UnionPay, which has a virtual monopoly over bank card transactions in China, has issued more than 4.5 billion cards in China and operates in all cities in China.

"The ability to buy apps and make purchases using UnionPay cards has been one of the most requested features from our customers in China," Eddy Cue, Apple's senior vice president of Internet Software and Services, said in a statement. "China is already our second largest market for app downloads, and now we're providing users with an incredibly convenient way to purchase their favorite apps with just one-tap."

The announcement comes amid questions about how Apple's homegrown mobile payment system Apple Pay will make inroads into China, the world's largest smartphone market. Apple Pay , which was introduced in the US last month, lets iPhone users tap to pay for goods and services at retail stores and buy goods within an app.

China, Apple's third biggest market in the world behind the US and Europe, has been a hefty cash cow for Apple. For Apple's fiscal fourth-quarter, which ended in September, China generated $29.8 billion, or 16 percent, of the company's total revenue in its fiscal fourth quarter.

One avenue for Apple might be a partnership with Chinese e-commerce giant Alibaba, which has built a mobile payments service called Alipay that boasts more than 300 million users. Alibaba co-founder Jack Ma said late last month that he's " very interested" in talking to Apple CEO Tim Cook about a partnership between his payments service and Apple's new mobile payments service.