KBank steps up credit-card drive
KASIKORNBANK has launched the “Route to Iceland” sweepstakes to accelerate acquisition of credit card customers in this second half of the year after the bank fell far behind the pace in the first half.
Noppawan Jermhansa, executive vice president, said yesterday that the bank issued 180,000 credit cards in the first half, while the target for the whole year is 600,000.
The contest should help the bank issue at least 200,000 credit cards because new credit card customers who spend Bt1,000 or more within 30 days after card approval will be given 10 chances to win prizes.
Existing cardholders will get one chance for every Bt1,000 in spending.
The “Route to Iceland” lucky draw, running until November 15, is in response to the tourism boom to exotic destinations.
It is the biggest campaign for this year. The bank set a marketing budget of Bt15 million, of which Bt3.8 million is for the prizes.
Travel spending grew 30 per cent, regarded as the highest segment. The bank wants to cater to customers in this category.
KBank targets total spending of Bt353 billion this year. The first half reached Bt170 billion, up 7 per cent from the same half last year and similar to the market’s expansion of 7-9 per cent.
“The overall market might not grow much but what we found out is that platinum credit cardholders showed spending growth of 13 per cent, indicating that upper-income customers are a healthy spending segment,” she said.
KBank has two million Platinum credit cards charging Bt19,000 monthly versus Bt13,000 for its general credit cards.
Mass customers remain worried over their future incomes, making card spending from this segment low.
The bank found a slight increase in non-performing loan from this segment as well as self-employed customers.
KBank’s credit card NPL ratio was at 2 per cent, up from 1.8-1.9 per cent from the end of last year. The bank will try to keep NPLs this year at 2.1 per cent.
“We will send an SMS to customers before the due date as a reminder. This method can help prevent bad debt from happening,” she said.
For new customers, it will use a credit scoring system based on the vocation of the customer and the region to analyse payment ability.
This method can help defend the bank from new NPLs.
Its credit card approval rate is 50 per cent, unchanged from the year before.
However, the rate for people earning monthly incomes of Bt15,000-Bt30,000 might |not amount to much, because |they have a tight debt-service |ratio.
