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Apple said it will launch its payment service in China as soon as 2016, pitting it against entrenched Chinese rivals Alibaba and Tencent.
Apple will partner with China's main bank card and payment firm UnionPay, a state-controlled consortium that has a monopoly on all yuan payment cards issued and used in the country.
The move will see Apple Pay take on Tencent's WeChat Payment and Alipay, the crown jewel of ecommerce king Alibaba's affiliate Ant Financial , the top player in China's fast-growing online payments market.
Eddy Cue, Apple's senior vice president of Internet software and services, said the tie-up with UnionPay and leading local banks would help Apple Pay give Chinese shoppers a "convenient, private and secure payment" option.
"China is an extremely important market for Apple," he said.
China, the world's second-largest economy, is one of Apple's most important markets for iPhone and tablet sales, but until now the firm has been kept out of its online payments market.
Online transactions are booming in China, boosted by the proliferation of hundreds of millions of smartphones that are being used for everything from paying for taxis and meals to buying goods at High Street stores.
In July, China proposed regulations to shake up the online payment services sector, where companies which own payment systems can reap huge profits by charging transaction fees.