CARDS & PAYMENTS | Cesar Tordesillas, Thailand

Thailand's KBank targets better-paying credit card users

Kasikornbank is pushing for more credit cards transactions for revolving credit, aiming to raise their proportion 55 to 60 percent in two years.

The bank wants to reduce the proportion of credit cards used only for transactions from 45 per cent to 40 per cent so that it can increase interest income, said executive vice president of KBank, Chatchai Payuhanaveechai.

The bank will join with partners and merchants to offer attractive interest rates for instalments.

KBank is more selective in acquiring cardholders, as it wants to ensure a lower rate of non-performing loans. Nonetheless, teenagers are among the target group of the campaign.

The campaigns for all segments and strong sales staff both at its branches and at its direct-sales unit are drawing quality customers, mostly from other banks, Chatchai said.

KBank has started expanding the campaigns to 14 main provinces in line with the group's strategy because the credit-card spending of provincial customers is only about 30-40 percent, lower than the 60-70 percent of those in Bangkok.

The new-card target for this year was 500,000, but the bank has already reached that, so it believes it will end the year with a total of 2.5 million cards, up 700,000 from last year.

Even though the bank spends more than Bt1 billion annually to redeem points, it can still make a profit, especially fee income.

Spending on KBank credit cards in the first eight months expanded 30 per cent to Bt119 billion and should approach Bt205 billion for the full year, Chatchai said.

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