KBank targets 'mass affluent' clients

Kasikornbank has focused more on customers with deposits and assets under management (AUM) of Bt2 million to Bt10 million to strengthen the deposit base. 

Pakorn Partanapat, executive vice president of KBank, said yesterday that “mass affluent” depositors who have AUM in that range could be divided into middle-income and affluent segment, and overall the mass-affluent segment was growing more strongly than the mass segment. The bank earlier had four segments: mass customers with deposits lower than Bt15,000 per month, middle-income customers who have deposits and AUM of no more than Bt10 million, affluent customers who have deposits and AUM of Bt10 million to Bt50 million, and high-net-worth customers with deposits and AUM of more than Bt50 million.

“These customers have different requirements, and the range of deposits and AUM of the middle-income and affluent segments has widened. Therefore, we should establish a new segment of depositors to provide the services they need,” he said. 

Overseas, AUM of the mass-affluent segment grows by 26 per cent per year on average against 13-14 per cent of the mass market. In Thailand, the AUM of this segment expands by 7 per cent per year, while that of the mass market has witnessed flat growth.

According to KBank, about 350,000 mass-affluent Thais have 38 per cent of the total AUM in the country, and 65,000 of them are KBank customers. The bank aims to boost that number to 85,000 by the end of this year. 

Pakorn said the AUM growth rate of the mass-affluent segment was interesting because these customers are individual businesspeople. Moreover, these customers are young, successful people who want to progress in their careers and gain the privileges enjoyed by the affluent segment.

The mass-affluent segment at KBank has deposits and AUM worth Bt120 billion, or 13 per cent of the total Bt980 billion in the retail-banking portfolio.

The bank has developed premium services for mass-affluent customers, including Premier credit cards, business opportunities and special financial services.

The bank will offer free fitness services, upgrades of economy-class Thai Airways International tickets to business class, and personal accident insurance for customers who spend via the Premier credit card. 

KBank soft-launched the Premier card last year but plans to expand the number of cards this year with the above privileges.

Spending via the Premier card by mass-affluent customers is Bt35,000 per card per month, while spending with basic KBank credit cards by this segment is Bt17,000 on average, while high-net-worth individual customers spend Bt75,000.

Pakorn said the bank would double the number of Premier credit cards this year to 50,000-60,000 from 27,000 currently.