BAY lender stops direct sales of cards


Krungsri Con­sumer, a provider of un­se­cured loans un­der Bank of Ayud­hya (BAY), has re­moved its direct sales chan­nel for credit cards and per­sonal loan prod­ucts and is gear­ing up for digi­ti­sa­tion, aim­ing to catch up with con­sumers’ chang­ing life­styles.

The un­se­cured lender has ter­mi­nated out­sourced con­tracts for the direct sales chan­nel, mainly due to the chan­nel’s lower po­ten­tial for cus­tomer ac­qui­si­tion and higher op­er­at­ing costs, said Thakorn Piya­pan, head of Krungsri Con­sumer.

The com­pany is con­tin­u­ing to de­velop the dig­i­tal plat­form, which has re­ceived pos­i­tive re­sponse from clients and will form an­other core chan­nel.

BAY branches are the key con­trib­u­tor to Krungsri Con­sumer’s new cus­tomers at 35-40%, fol­lowed by part­ner­ship net­works with Cen­tral Depart­ment Store, Tesco Lo­tus and HomePro (30-35%) and dig­i­tal and so­cial me­dia chan­nels (less than 10%).

The bank has more than 600 branches na­tion­wide.

“We ex­pect the ra­tio [of new cus­tomers] from dig­i­tal and so­cial me­dia chan­nels to in­crease to 15-20% next year,” Mr Thakorn said. “The chan­nel can serve real de­mand with lower op­er­at­ing ex­penses, so it has high growth po­ten­tial.”

The com­pany is tak­ing aim at launch­ing dig­i­tal lend­ing ser­vices, tar­geted at ex­ist­ing card­hold­ers and per­sonal loan cus­tomers, by the first quar­ter of next year. The ser­vice, which is a chan­nel that cus­tomers can use to ap­ply for per­sonal loans, must be tested out in the Bank of Thai­land’s reg­u­la­tory sand­box.

Krungsri Con­sumer, the coun­try’s largest provider of un­se­cured loans, aims to achieve its new card is­suance tar­get of 840,000 this year af­ter 700,000 were put into cir­cu­la­tion in the first seven months of the year.

The lender ex­pects 8-9% growth in its credit card spend­ing this year, com­pared with a 12-13% tar­get, af­ter growth stood at 7% for the first seven months of 2017.

In the mean­time, Mr Thakorn, who is also chair­man of the Credit Card Club, yes­ter­day in­tro­duced the Smart Con­sumer cam­paign to en­cour­age con­sumers, par­tic­u­larly univer­sity stu­dents and first-job­bers, to be more aware of fi­nan­cial dis­ci­pline.

The cam­paign, a part of the Thai Bankers’ As­so­ci­a­tion’s fi­nan­cial lit­er­acy project, en­cour­ages con­sumers to save at least 20% of to­tal in­come per month. The im­prov­ing fi­nan­cial dis­ci­pline will help bring down the coun­try’s house­hold debt, which ac­counts for al­most 80% of GDP now.

A Krungsri ATM of­fers Car 4 Cash per­sonal loans.

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