HSBC ramps up credit busi­ness on the main­land

Bank­ing gi­ant launches first batch of credit cards to cash in on ris­ing con­sump­tion power in the mar­ket

China Daily (Hong Kong) - - BUSINESS | HK - By ZHOU MO in Shen­zhen sally@chi­nadai­lyhk.com

Bank­ing gi­ant HSBC has taken another ma­jor step for­ward in ex­pand­ing into the Chi­nese main­land by launch­ing its first credit cards there on Monday, as it strives to reap the ben­e­fits cre­ated by the mar­ket’s grow­ing con­sump­tion power.

The launch of the cards by Hong Kong’s largest lender, in co­op­er­a­tion with China UnionPay and Mastercard, will fur­ther fa­cil­i­tate mainl a n d p e o p l e’s s p e n d i n g i n Hong Kong , es­pe­cially fre­quent trav­el­ers to the SAR, as card­hold­ers will be able to en­joy spe­cial priv­i­leges of­fered by more than 2,000 mer­chants in the city.

The three cat­e­gories of credit cards to be is­sued — HSBC Pre­mier Travel Credit Card, HSBC Travel Credit Card and HSBC Choice Credit Card — are de­signed to cater to main­land con­sumers’ ris­ing de­mand for travel and en­ter­tain­ment.

The cards will be is­sued in all cities in the Pearl River Delta (PRD) re­gion, as well as 30 other main­land me­trop­o­lises.

“The launch of HSBC- branded credit cards demon­strates progress in our plan to grow a full-scale dig­i­tally-driven re­tail bank­ing and wealth management busi­ness in the PRD,” said He­len Wong, chief ex­ec­u­tive of HSBC Greater China.

“Just as credit cards are a pil­lar of HSBC’s mar­ket-lead­ing busi­ness in Hong Kong, we ex­pect credit cards to be a key touch point for us in at­tract­ing new cus­tomers and deep­en­ing ex­ist­ing cus­tomer re­la­tion- ships in the PRD, as well as the rest of China.”

The is­suance of the new credit cards comes as the main­land tries to shift its econ­omy from an in­vest­ment- and ex­port­driven de­vel­op­ment model to one pro­pelled by con­sump­tion. In­dus­try in­sid­ers say the move is ex­pected to ben­e­fit HSBC to a big ex­tent.

De­vel­op­ing per­sonal fi­nan­cial prod­ucts has be­come the top choice of many banks as they trans­form them­selves against the cur­rent eco­nomic back­drop, said Shi Wen­chao, pres­i­dent of China UnionPay. “Card-based re­tail busi­ness, mean­while, is one that’s most re­al­is­tic and where risks are most con­trol­lable,” he said.

Yu Lingqu, a re­searcher with the fi­nance and mod­ern in­dus­try re­search cen­ter at the China De­vel­op­ment In­sti­tute, a Shen­zhen-based think tank, said con­sumer fi­nance busi­ness has been grow­ing at a fast speed on the main­land in re­cent years, lay­ing a solid foun­da­tion for HSBC’s de­vel­op­ment in the field.

According to a re­port by Beijing-based iRe­search Con­sult­ing Group, the main­land’s con­sumer credit mar­ket hit 19 tril­lion yuan ($2.8 tril­lion) last year, grow­ing 23.3 per­cent year-on-year. The mar­ket is likely to ex­pand to 41.1 tril­lion yuan by 2019.

“Con­sumer fi­nance has be­come an im­por­tant source of prof­its for banks,” Yu told China Daily.

He added that HSBC has a long his­tory in con­sumer fi­nance busi­ness and its de­vel­op­ment in the area has

Com­pared with other banks, the big­gest ad­van­tage of HSBC’s is­suance of cred­its cards on the main­land is that it has rich re­sources. It’s also able to co­op­er­ate with var­i­ous mer­chants, es­pe­cially in­ter­na­tional ones like high-end lux­ury brands.”

a re­searcher with the fi­nance and mod­ern in­dus­try re­search cen­ter at the China De­vel­op­ment In­sti­tute

tril­lion

the value of the main­land’s con­sumer-credit mar­ket in 2015

been “quiet well”.

“Com­pared with other banks, the big­gest ad­van­tage of HSBC’s is­suance of cred­its cards on the main­land is that it has rich re­sources. It’s also able to co­op­er­ate with var­i­ous mer­chants, es­pe­cially in­ter­na­tional ones like high-end lux­ury brands,” Yu said.

According to HSBC, new credit-card hold­ers can en­joy a string of ben­e­fits and dis­counts in shop­ping, din­ing, leisure and en­ter­tain­ment in some 150 coun­tries and re­gions world­wide, es­pe­cially pop­u­lar tourist des­ti­na­tions like Thai­land, Ja­pan and the United States.

PRO­VIDED TO CHINA DAILY

He­len Wong, (fifth from right) chief ex­ec­u­tive of HSBC Greater China, flanked by in­dus­try lead­ers and Shen­zhen gov­ern­ment of­fi­cials, at the launch of the first batch of the bank’s credit cards on the Chi­nese main­land in Shen­zhen on Monday. Through co­op­er­a­tion with China UnionPay and Mastercard, HSBC aims to fur­ther fa­cil­i­tate main­land peo­ple’s spend­ing in Hong Kong, where spe­cial card priv­i­leges are of­fered by more than 2,000 mer­chants.

Yu Lingqu,

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