Twenty years ago, a group of credit card backbones from Taiwan and pathfinders from local banks jointly awakened the long-sleeping China The credit card market.
In an era when corporate business was absolutely dominated and relied on manual approval, this group of people took the lead in entering the “big industrialization” stage of banks, opening up digital, automated, and intensive production methods.
Ten years ago, the wave of financial technology sprung up. Some people took advantage of the trend to promote the second prosperity of the credit card market, and some people changed the track to help the Internet finance take off.
The flow of credit card people and the changes in the market structure reflect the strategic evolution of commercial banks, as well as the impact and subversion of the technological revolution on the financial industry in different eras.
This article would like to record the pioneers of the credit card industry and their golden age.
This article is from WeChat official account:Xinfinance (ID: Xinfinance)< span class = "text-remarks">, author: Hung Ruo Xin, head Figure from: vision China
In 1999, the first and largest private bank in Taiwan, China-China Trust Bank(hereinafter referred to as “CITIC Bank”) Ushered in a new head, Gu Zhongliang, who is only 35 years old. This also means that he officially succeeded his father, Gu Liansong, and became the head of the Koo family’s financial domain.
Gu Zhongliang, who was born in one of the five major families in Taiwan, China, does not have the arrogant temperament of the prince. On the contrary, he has been regarded as the “number one successor” since he was a child and has been receiving extremely rigorous training. After graduating from overseas study, Gu Zhongliang worked in top financial institutions such as Morgan Stanley, Bank of New York, and Mitsubishi Trust.
Return to Taiwan, China to enterAfter the family business, Gu Zhongliang showed amazing courage. When the media reported, he did not hesitate to praise him, saying that he was tall and handsome, with a solid and perfect resume, and regarded him as a model of the younger generation of entrepreneurs in Taiwan.
Gu Liansong did not give his son a chance to breathe. When he turned over, he set a goal for Gu Zhongliang: By 2004, the profit would reach 30 billion yuan—that is, five times the amount in 1999. At the time, this was almost an impossible task.
At that time, the banking industry in Taiwan, China had been overly competitive for many years. Coupled with the bursting of the domestic economic bubble, interest rates fell, unhealthy and high, and the profitability of the banking industry generally deteriorated. The former prosperity is long gone, and what Gu Zhongliang took over was a hot potato.
Similarly, in 1999, China Merchants Bank in Shenzhen also just changed its head. 50-year-old Ma Weihua succeeded Wang Shizhen as the second president of China Merchants Bank. The challenges he faces are equally severe. Unlike the excessive competition in Taiwan’s banking industry in my country, the mainland banking industry is still in the early stages of development.
Although at that time, China Merchants Bank had already released its star product “All-in-One Card”, it was not well received. By 1999, the total personal deposits of China Merchants Bank accounted for one-third of the bank’s total assets, and new personal deposits exceeded 10 billion yuan each year. But in a few years, the cumulative income of the personal banking department was only a few hundred million yuan.
Ma Weihua, who took over, has been in the supervisory department before. For him, this change is also a huge span. Before joining China Merchants Bank, Ma Weihua had just led the completion of the bankruptcy liquidation of Hainan Development Bank, which was also the first bank to be closed in China.
Coincidentally, Ma Weihua encountered two of the most famous crises in the history of China Merchants Bank in the first week of his appointment in 1999: the central bank halted offshore business and the Shenyang branch run on the bank. These two liquidity risks also caused China Merchants Bank to rethink its positioning and long-term planning.
At that time, Ma Weihua and Gu Zhongliang didn’t know that two years later, the companies behind them will have a short and profound intersection. Although they eventually separated, they profoundly affected China’s credit card industry in different ways.
1. A short intersection
Shortly after taking control of CITIC Bank, the 35-year-old Gu Zhongliang shot the “first shot.” He persuaded his father, Gu Liansong, to change CITIC Bank from the “asset scale” orientation to the “profit growth” orientation, namelySignificantly reduce real estate loans and increase the layout of the personal financial market.
At the time, it seemed that this was not a wise decision.
CITIC Bank’s credit card business is already the best among local banks, contributing more than 40% of its profits every year. This also means that this market does not leave much room for Gu Zhongliang to play, after all, the remaining share is basically firmly controlled by foreign banks represented by Citigroup.
But soon, Gu Zhongliang proved his vision and ability with his performance.
Through a series of drastic reforms such as the abolition of the annual credit card fee,CITIC Bank’s issuance of cards has soared, from 2 million to 5 million in less than three years, defeating Citibank in one fell swoop and becoming China The largest card issuing bank in Taiwan. Moreover, it has maintained extremely strong profitability and is known as “Taiwan’s most profitable bank.”
In Taiwan’s banking industry, which has always been dominated by foreign investment, Gu Zhongliang’s battle was a blockbuster. The youngest head of the banking industry on the island is in the limelight for a while.
An episode was that Luo Lianfu, Zhong Jiwei, and Chen Kunde, the “iron triangle” that helped CITIC Bank dominate the island’s credit card market, later participated in and promoted the establishment of credit card centers in mainland banks in different ways. Credit card market development is also a great contribution.
Speaking back to the Taiwan market at that time, local card issuers squeezed wildly with their active marketing strategies, and even the global credit card “leading” like Citi Credit Card could only lean back. In this area with a population of less than 20 million, the number of cards issued has reached more than 30 million, which once attracted the admiration of the mainland colleagues.
Because of that stage, several large state-owned banks and joint-stock banks in the Mainland are preparing to build credit card centers. Foreign-funded institutions represented by Citigroup, and Taiwanese companies in my country represented by CITIC Financial are the focus of study and cooperation among various institutions.
The credit card industry in Taiwan, China, which has been in a fiercely competitive environment for a long time, has built a complete, efficient, and advanced operating system, as well as a large number of professionals. They have not only absorbed the experience of foreign banks such as Citigroup and American Express, but also combined the Chinese culture and habits to carry out a large number of localized transformations, which are more suitable for the mainland market.
In 2001, Ma Weihua agreed to cooperate with China CITIC Bank and asked him to act as a consultant to fully assist in the establishment of the China Merchants Bank Credit Card Center.In order to facilitate this cooperation between the financial institutions on both sides of the strait, the approval was submitted to the highest level, and it took many twists and turns before the decision was finalized.
Although it is only in the name of a consultant, CITIC Bank’s voice in cooperation is not weak in fact, because the recruitment act at that time promoted cooperation, opened up a lot of resources and space, and of course there was a high cost. Some old people from China Merchants Bank recalled this past event to me, and still sighed at the courage of the leaders of the bank at that time.
In the joint management committee, the permanent representatives sent by CITIC Bank are Luo Lianfu, and the vice president Zhong Jiwei, and China Merchants Bank is the vice president Chen Wei, the general manager of the retail finance department Liang Yaolan, and the head of the science and technology department. . These few people have left a deep mark on the development of China’s credit card industry in the future.
With the joint efforts of the two companies, in December 2002, China Merchants Bank officially issued its own credit card. But unfortunately, the honeymoon period between the two parties did not last long. CITIC Bank hopes to further develop its presence in the mainland market and plans to acquire a stake in a commercial bank. For this reason, it had to terminate its cooperation with China Merchants Bank ahead of schedule.
Second, “Taigan” goes north
Although the cooperation between CITIC Bank and China Merchants Bank ended hastily, the IT system, business philosophy, management system, business process, and a large number of well-trained employees that they left behind have laid a solid foundation for the development of China Merchants Bank’s credit card. .
Although the official cooperation has been lifted, some of the backbone of CITIC Bank has become associated with China Merchants Bank. Some people have chosen to join China Merchants Bank. For example, the aforementioned Zhong Jiwei, who formally joined the China Merchants Bank Credit Card Center as the general manager in 2004.
At that time, China Merchants Bank, which was determined to develop its retail business, showed an amazing pattern and vision. It not only withstood the pressure of public opinion inside and outside the industry, but also gave Zhong Jiwei a million-level annual salary-far exceeding Any senior executive in the industry. Liang Yaolan, the former general manager of the Card Center, also voluntarily gave up her position and became Zhong Jiwei’s vice president.
That was the eve before the Chinese credit card market set sail, and mature credit card people from different institutions gathered to the Chinese mainland market.
Zhong Jiwei, who moved to Shanghai, found that he was not alone. Because almost at the same period, he had a group of old colleagues and friends from Taiwan who joined different banks in the same place to take charge of credit card or retail financial business.
For example, Zeng Kuanyang, who once worked with him at the Taiwan branch of Citibank. In June 2004,Zeng Kuanyang was appointed by Citibank to serve as the CEO of SPD Citi Credit Card Center. Also, the first general manager of CITIC Credit Card Center is also from Taiwan Province.
In addition, like Zhong Jiwei, Chen Kunde, who was also the Vice President of CITIC Financial (abbreviation of China Trust Financial Holdings Corporation), was Ping An Group dug a corner and became the first president of Ping An Bank.
It’s just that the Ping An Bank at that time was not what it is today. It was still small in scale and did not even have the qualifications to issue credit cards. Its predecessor was Fujian Asian Bank. At the end of 2003, Ping An Trust and HSBC jointly acquired it and renamed it Ping An Bank, headquartered in Shanghai.
Later, Ping An Bank became what it is today after several integrations and evolutions. Ping An Credit Card Center has changed several groups of management. Both Taiwanese talents and China Merchants Bank have played key roles in its development. For example, Liang Yaolan of China Merchants Bank was the CEO of Ping An Credit Card. Later, Zeng Kuanyang, who worked for Shanghai Pudong Development Bank, also served as CEO for many years…
Speaking of the “Northern” Taiwan cadres at that time, apart from a few CEOs known to the outside world, almost every credit card center can find several consultants from Taiwan, especially for key functions such as marketing, customer service, and IT. Most departments have found foreign aid.
These Taiwanese consultants have witnessed the whole process of Taiwan’s credit card market from 0 to 1, from its peak to recession. With their arrival, my country’s “Taiwan model” has also been copied to the mainland market.
Including, active operation strategy, industrialized operation process, extreme emphasis on data and production capacity, etc. have brought a new atmosphere to the credit card market in the Mainland. Although some methods have also been criticized, objectively speaking, these methods are still very effective in the initial stage of a new market.
A small example, the most important part of credit card business-customer service. At that time, according to the standards of the Taiwan market, each customer service received an average number of calls per day, and each call had strict requirements, such as one call on average. It took 132 seconds from the beginning to when the customer died satisfactorily.
This kind of strict control of the process and extreme requirements for production capacity has quickly brought the credit card center into the “big industrialization era”. Because the banking industry relied heavily on corporate business at that time, and the operation method was still manual approval, the shock that this change brought to the bank and employees can be imagined.
In addition, the most representative of my country’s “Taiwan Model”There are a variety of large-scale marketing methods, from annual fee waivers, gifts, to co-branded cards, swiping card gifts, consumer points, etc., all of which have not been completely copied. The annual marketing expenses have suddenly rushed to the level of tens of millions.
For example, China Merchants Bank has launched a long time credit card consumption to return cash, credit card points in exchange for Passat, Mini Cooper and other marketing activities. This caused a quite sensational effect at the time, sparking heated discussions between the media and netizens, and various strategies for swiping cards to exchange cars emerged one after another on the Internet.
And later, the classic event “9 points for Starbucks” of CITIC Credit Card was also the result of a Taiwanese consultant invited. It costs 20 to 30 million yuan in marketing expenses at a time. It is said that the person in charge of the card center at the time was also very nervous.
Because the redemption threshold is extremely low and the conversion effect is difficult to measure, CITIC wanted to test the water on a small scale first, but the marketing expert insisted on all in the country. After experiencing the fierce battle in the Taiwan market, they have a strong understanding of users and the market. The understanding and control of data and performance have been very precise.
Later, “9 points for Starbucks” was a big success and became one of the most representative marketing events of CITIC Credit Card. It brought a large number of high-quality white-collar and elite customers to it and helped it consolidate its position in the industry.
In fact, in addition to the introduction of “outside brain” China Merchants Bank, the more mainstream method at the time was the “joint venture model.” Between 2002 and 2004, credit card centers jointly established by Bank of Communications and HSBC, Shanghai Pudong Development and Citibank, Industrial and Hang Seng Bank, etc. all opened successively.
In the next few years, the four major banks, including the four major banks, have also “paired up” with foreign banks through strategic cooperation and other means, trying to jointly develop their credit card business, but this is something to be said. Looking at it today, some of the cooperation with foreign institutions ended without a problem, some were not effective, and there were no particularly successful cases.
About 2004, the credit card centers of several major banks and joint-stock banks opened one after another, with little success. In terms of data and brands, China Merchants Bank and GF are more outstanding, followed by Bank of Communications, Bank of China, China Construction Bank, ICBC, and Shanghai Pudong Development Bank.
This is also the first change in the industry pattern. Although the four major banks have unparalleled branch advantages and user base, the joint-stock bank has achieved a corner overtaking in the credit card category by virtue of more thorough mechanism reforms and active operating strategies.
Starting from the first year of credit card in 2003, the next ten years will be the stage where China’s credit card market really takes off. There have been qualitative breakthroughs in the scale of issuance and customer coverage.And each card center is working hard to explore its own path and play, and a group of local people, the soul and backbone of the credit card industry have emerged.
3. The Golden Generation
One day in 2005, Chen Jin, who was already working for China Merchants Fund, accidentally ran into his old leader at China Merchants Bank-the former executive vice president of China Merchants Bank Chen Xiaoxian. At this time, he had just been transferred to China CITIC Bank as president. At that time, CITIC was worried about the stagnation of its credit card business.
By chance, Chen Jin had never done a credit card business and took over this task. In hindsight, he had to admire President Chen’s insight. In this way, in August 2005, Chen Jin became the general manager of CITIC Credit Card Center.
In order to let him get familiar with the credit card business quickly, Before the formal entry, President Chen asked his old friend, Luo Lianfu, who is known as the “Father of Taiwan Credit Cards” in my country, to arrange a training camp. Chen Jin spent a full month in Taiwan, taking turns to experience and learn in different positions in China Trust Bank.
This precious experience has benefited Chen Jin a lot and laid the foundation for the rise of CITIC Credit Card. In 2005, the CITIC Credit Card issued more than 500,000 cards and more than 200 employees. It has not yet achieved profitability, and its asset quality is worrying. For a newcomer in the credit card industry, the challenge is too great.
In 2005, like Chen Jin, his old colleague Dai Bing, who used to work in the retail banking department of China Merchants Bank, began to accept new challenges. In November of this year, Dai Bing joined China Everbright Bank as the general manager of the credit card center. They are the first batch of credit card center executives from China Merchants Bank.
At its root, China Merchants Bank was the only bank in China that vigorously developed retail financial services at the time. Compared with the reliance on individuals and resources for corporate or investment banking services, retail banking services including credit cards relied more on systems, technology, and Experience, and a top-down strategic landscape.
Jobs has contributed a large number of mainstays to the credit card industry, and they led their respective institutions to rewrite the pattern of the credit card market again. From this point of view, this is what Taiwan’s technical talents regret. Except for a very small number of people who have the opportunity to become senior executives, most of them are middle-level or business backbones.
In 2007, Chen Wei, then vice president of China Merchants Bank, transferred Liang Yaolan to Ping An Bank with his love. (Later with Shenzhen DevelopmentExhibition merger) to build a credit card system.
In the same year, Yan Xuewang, Vice President of the Retail Banking Department of China Merchants Bank, became the general manager of the Industrial Bank Credit Card Center. Later, Yuan Yaozhang, president of the Credit Card Center of the Bank of Beijing, worked at the China Trust Bank in Taiwan and also worked at the Credit Card Center of China Merchants Bank for many years.
If you count the vice president or middle level, China Merchants Bank has sent more talents to the credit card industry in those years. Looking at it today, almost every member of the credit card center or middle-level backbone has the China Merchants Bank department. This also makes China Merchants Bank known as the “Whampoa Military Academy” of China’s credit card industry.
An obvious trend at this stage is that the core executives are transferred from the first batch of credit card centers to other banks. In addition to the aforementioned China Merchants Bank Department, the Bank of China, the first in China to issue credit cards, has also sent many talents. For example, in 2007, Hou Ping, former deputy general manager of the Bank of China Credit Card Center, airborne Hua Xia Bank as the general manager of its card center.
Soon, the pattern of the credit card market changed again. In addition to a few major state-owned banks, CITIC, Everbright, and Industrial Credit Cards have risen rapidly, breaking through 10 million cards in 2010, 2011, and 2012, respectively, making them the second echelon of joint-stock banks. China Merchants Bank and Guangfa Credit Card strictly adhere to the first echelon. .
By 2009, there were 186 million cards in the industry, and the transaction volume that year was about 3.5 trillion. This data shows that credit cards have become a relatively common consumer financial tool in China. But embarrassingly, the credit card center failed to produce good enough economic benefits, and even the non-performing rate has risen sharply.
So, regardless of the scale of development cards, the credit card centers recognized as the strongest in the industry all have card issuance volume, high profits, and good control of non-performing rates. A typical example is the GF Credit Card, which is proud of its superior profitability in the industry. Even China Merchants Bank has led a team to GF Credit Card many times to learn from it.
In the credit card industry at the time, GF was an alternative. General Manager Lu Shifeng has no background in overseas business, and has never been exposed to credit card business before. When this cadre trained by China Guangfa Bank received the task of developing credit cards, everything started from scratch.
From reviewing information and writing credit card business development reports to establishing GF Credit Card Department; from taking charge of GF Credit Card Center (1995) to being promoted to GF The general manager of the bank’s retail business, Lu Shifeng, single-handedly promoted the rise of GF Credit Card. By the time she left in 2015, she was already working in GuangfaMade it for 28 years.
Although it is officially defined that the Bank of China issued China’s first credit card in 1985, it is actually a quasi-credit card in terms of function and nature.(Applicants must deposit a sum of money in the bank first). The first credit card that truly conforms to international standards, which is the consensus of the industry, came from China Guangfa Bank and was issued in 1994.
For a long period of time, GF and China Merchants Bank credit cards have their own strengths and are not the same, and are recognized as “Gemini” in the industry. Compared with GF, China Merchants Bank, which has started the “secondary transformation”, has shown its momentum as the king of retail, which has also injected greater energy into the further development of its credit card business.
Since 2009, the China Merchants Bank Credit Card has passed the stage of chasing scale. Under the leadership of the new President Liu Jialong, a new round of development with the goal of “intensive cultivation” has begun, that is, on the basis of maintaining stable growth of the customer base. Enhance the value contribution of cards, adjust the focus of resource allocation, and vigorously tap customer value.
So far, the “golden generation” of the credit card industry has all appeared, and various institutions have gradually formed their own characteristics and styles. Just as they were gearing up to fight fiercely with their peers, they realized that their biggest opponent was not from the financial industry.
four, cross-border opponents
At the Apple Summer Conference on June 8, 2010, an important watershed appeared when the iPhone 4 came out and the “iOS” platform was upgraded. Smart phones have begun to replace feature phones on a large scale, and Android and Apple systems have gradually become the mainstream, and the development of 3G and 4G has accelerated the penetration of the mobile Internet.
A new era of “moving” everything has arrived.
In this year, Alipay launched the “quick payment” function, making the credit card industry a big enemy.
As a result, Alipay’s user experience and payment success rate have been qualitatively improved. Alipay, which originally has both payment and account attributes, has taken a big step closer to credit cards. Not only that, fast payment allows Alipay to accumulate more dimensions of data across terminals and banks, which makes it amazing in financial imagination.
For credit card practitioners, before 2010Later, they were brought into a new battlefield by payment giants and Internet giants including Alipay. This is a situation completely different from the past and even from other countries and regions in the world.
The changes in the market structure often start with the transfer of talents.
In mid-2010, veteran credit card veteran Zhong Jiwei of China Merchants Bank, former assistant general manager Song Jingren, senior consultant Xue Yongjia and a group of veterans in the credit card field were dubbed to Alipay. At that time, it was rumored in the industry that Alipay was planning a mysterious project and was about to enter the market with “nuclear weapons”.
In fact, starting with quick payment, Alipay has slowly invaded the territory of credit cards. Of course, at the beginning, it was a win-win cooperation. For example, Alipay and Tencent successively announced the launch of “virtual credit cards” with CITIC Credit Card.
I never thought that this product received inquiries from the supervision on the day of the official announcement, and soon it was stopped along with the QR code payment. The different fate is that the QR code payment was later quietly resumed, but the virtual credit card has been stranded.
Afterwards, Internet giants skipped the joint issuance of virtual credit cards. Credit payment products represented by Huabei and Baitiao swept the market, directly dragging credit cards into a whole new battle. This is also something to follow.
Beginning in 2013, with the popularization of mobile payments and the emergence of Yu’e Bao, Internet finance has swept the market with a destructive force. Almost all leading Internet companies have extended their tentacles to the financial field. Among them, consumer credit and consignment financing in retail finance are the main entry points.
At this stage, each card center has a large number of backbones and young backbones who have joined the tide of Internet finance, joined or started businesses. This list is too long. In addition to domestic credit card institutions, American Express and Capital One also contributed a large number of talents to the domestic mutual gold industry.
Especially in key departments such as risk control, operations, and collection, almost every mutual gold company can find several employees who have experience in the credit card industry. A few years after the development of Internet finance, a WeChat group of former Capital One employees who had returned to China could no longer fit in a WeChat group.
Because credit cards are highly compatible with the Internet financial business at the time regardless of the nature of the business or the method of operation: purely online, centralized, large-scale operation, and first investment and acquisition Customer, promotion, loss, and then after breaking the breakeven pointThe development method of substantial profit growth is very much like the Internet industry.
In 2013, Xu Ling, who had worked for ICBC bank card center for many years, joined the newly established JD Finance (later renamed to JD Digital) span>. Under his leadership, in February 2014, JD.com “Bai Tiao” went online.
Under the slogan of “consumption first, pay later”, the “white bar” detonated the market as soon as it went online. This is also the first Internet consumer financial product. From an experience point of view, “White Bar” is almost the same as a credit card. What’s more advantageous is that it can complete the application and credit process online and in real time within one minute.
“Bai Tiao” has become the flagship product of JD Finance, contributing a large number of customers and revenue to it. Until last year when it hit the listing and released its prospectus, “white bars” were still its core business and main source of profit. Xu Ling is also known as the “Father of Bai Tiao” internally and has become one of JD’s most important talkers in the financial sector.
In May of this year, Chen Jin submitted a letter of resignation to CITIC and joined ZhongAn Insurance, the first Internet insurance company in China, as the CEO. ZhongAn later made efforts in the credit insurance business, and Internet consumer finance was also an important position.
At that time, the new financial wave was already surging, and various new types of business were emerging. In addition to Internet insurance, the first batch of Internet banks are also in preparation. In 2014, Liang Yaolan, the veteran of the credit card industry, and Cao Tong, who also worked in China Merchants Bank and China Trust, joined WeBank as the vice president and president respectively.
Because of the strong expansion of Internet giants in the financial field, and the deepening of the integration of financial technology itself and the financial industry. After 2013, the market structure of credit cards has also undergone some subtle changes. Some card centers that seize the opportunities of the times have risen or widened the gap; others have slowly fallen behind.
The latter is like Bank of Communications, and the most representative of the former is the Ping An Credit Card. With its spare no effort in financial technology and the advantages of the linkage of multiple license resources within the group, it has come up to the second echelon and has made a big difference. the trend of.
And another joint-stock bank, Shanghai Pudong Development Bank Credit Card Center, also made rapid progress during this period, and its performance was eye-catching.
The outside world generally attributed the transformation of the SPD Credit Card in the past few years to Liu Xianfeng, who took over as the general manager in 2014. After he took over, on the one hand, he focused on Internet channels, consolidating technical capabilities, and emphasizing user thinking.Maintenance; on the other hand, reorganizing the internal structure, advocating flat management, and improving operational efficiency.
For a long time, the industry believed that the Pudong Development Credit Card “was up early but rushed to the late episode” until Liu Xianfeng completed the counterattack. From the time he took the helm of the Pudong Development Credit Card Center to his transfer to leave in 2020, the number of SPD credit cards in circulation, transaction finance, and loan balances have increased geometrically during this period.
A latest episode is that in March 2021, Liu Xianfeng switched to Ping An Bank as the director of retail business, in charge of consumer finance, credit card and other businesses. Looking back at the development history of Ping An Credit Card, it is true that the elites of various credit card centers have “collected”.
In short, this is an era in which financial technology has risen strongly and is beginning to profoundly change credit cards. It is also a stage where credit card institutions are sending a large number of talents to Internet companies.
A large number of compound talents emerged at the historic moment. They are one of the few people who truly blend the two cultures and experiences of the financial industry and the Internet, and finally embodied them in specific products. Of course, as mentioned earlier, credit cards were originally similar to many business cores in the mutual fund era.
Typical examples are all kinds of credit payment products, which already have both payment and borrowing functions. Except for the lack of physical cards, they are almost the same as credit cards. More importantly, they have realized closed-loop transactions based on the giant’s ecology, and they have unparalleled advantages in user experience.
If you ask the young people of Generation Z today, there are probably many more people who understand Huabei and Weiweidai than credit cards. This is probably a situation that credit card practitioners never expected-their biggest opponents turned out to be a group of people. Internet company.
5. Who controls the ups and downs
Reviewing the development of China’s credit card industry, 2017 should be a highlight.
In that year, the cumulative issuance of domestic credit cards soared from 465 million in the previous year to 588 million. The cumulative issuance increased by 26.45% year-on-year, which was 18.9 basis points higher than the growth rate of debit cards in the same period. Faster than debit card.
But since then, the growth rate of the credit card market has gradually slowed down, and it has begun to enter the so-called “stock era.” The number of cards issued fell from a high of nearly 7% in the third quarter of 2017 to 0.32% in the first quarter of 2021.
Although until last year 4In the quarter, the growth of card issuance has rebounded, but the growth rate of credit scale is still at a historical low level
At the same time, the development of the “Great Leap Forward” in the previous few years has begun to counteract, and the number of defects has risen sharply. The deficiencies of many credit card centers reached a climax in 2019 and ate up most of their profits. Some card centers with excellent profitability actually suffered losses in the current period.
The impact of the epidemic in 2020 will be even worse.
Performance of some banks’ credit card services in 2020
According to incomplete statistics from Xin Financial, among the six major banks and some of the joint-stock banks that disclose financial reports, only three new credit card issuances in 2020 will exceed 10 million, namely, China Construction Bank, Agricultural Bank and Ping An Bank.
Correspondingly, ICBC will issue only 1 million new cards in 2020, one-eighth of the same period in 2019, a record low over the years; Shanghai Pudong Development Bank has rarely seen a decrease in the number of cards in circulation.
Under the trend of tightening card issuance, the credit balance of most banks has increased. Among them, the growth rate of CCB, Agricultural Bank, Postal Savings, and Industrial Development exceeds double digits. This may be related to the adjustment of operating strategies and Increased instalment efforts to increase revenue and profit scale.
However, in terms of overall activity, many banks’ credit card transaction amounts have declined. Among them, the scale of ICBC credit card transactions fell by nearly 20% year-on-year, and China Merchants Bank also experienced a slight decline in transaction amounts. The impact of the epidemic on consumption and transactions is evident.
Under the overall contraction of business, although banks are increasing their efforts to dispose of non-performing assets, the non-performing rate of credit cards has generally risen sharply.
Of course, in addition to near superiority, more far-sighted. For the credit card industry, the bigger challenge is how to regain the value of credit cards in the mobile Internet era? Change to a more cruel questionMethod: Is there a future for credit cards?
“The medium will change, the card will disappear, but the core of the credit card will remain.” This is the answer to this question by most credit card holders. But the reality is: business growth is weak, bad rebounds are obvious, and the young people’s market is becoming more and more incapable… These are huge challenges facing practitioners.
In the era of mobile Internet, the medium of credit cards has evolved from plastic cards to mobile apps. The Internet giant, which occupies traffic portals and user minds, has unparalleled advantages and has become the most powerful opponent of credit cards and even the entire retail bank.
Although since last year, supervision has taken measures to control credit payment products, it has not stopped completely. Products including Ant Huabei, JD Baitiao, WeChat Pay and Meituan Monthly Payment are still gaining momentum. With the expansion of the giants behind them, the experience and scene advantages of these products have surpassed that of credit cards.
I don’t know if the pioneers in the credit card market can once again lead the industry out of the predicament and reproduce the glory of the golden age.
This article is from WeChat official account:Xinfinance (ID: Xinfinance)< span class = "text-remarks">, author: Hung Ruo Xin