China UnionPay Co. Ltd. is under fire from domestic and foreign rivals that are vexed by its monopoly powers and want to gain entry to the country's rapidly expanding payments market.

The Shanghai company, which operates China's only electronic payments network and card brand, grew significantly last year.

In March, the Obama administration said it was considering a formal complaint against China with the World Trade Organization for barring U.S. companies from competing in the Chinese payments-processing market. Analysts said the move was prompted by concerns from U.S. card brands.

And in China, domestic financial companies have called for a second Chinese network, but observers say the People's Bank of China, the country's central bank, has pushed back.

Creating a single national network made sense when the Chinese government started China UnionPay in 2003, giving it a "strong position" to provide an electronic payments infrastructure for the emerging consumer class, said Dave Duncan, group executive for China and Southeast Asia at Total System Services Inc. In 2005, the processor bought nearly 45% of China UnionPay Data, UnionPay's processing subsidiary.

Before China UnionPay was created, each Chinese bank had to form its own merchant relationships for card acceptance, Duncan said. But banks might operate cards on different systems in different regions, so a MasterCard Inc. card that worked at one bank's branch in Beijing might not work at its branch in Shanghai.

In 2009, issuance of China UnionPay-branded cards in China soared 42%, to 1.3 billion, with spending on those cards increasing by 85%, to $885 million, said Terry Xie, director of Mercator Advisory Group's international advisory service.

About 43% of Chinese credit cards are branded China UnionPay, while Visa Inc. has its brand on 30% and MasterCard Inc. on 22% of cards.