Commercial banks' credit card services are changing. The reporter of the "Economic Information Daily" learned that a number of banks, including Ping An Bank, Shanghai Pudong Development Bank, Postal Savings Bank, Bank of Communications, and China CITIC Bank, recently issued announcements saying that from 2024, the rights and interests of some of their credit cards will be adjusted. On the one hand, by increasing the threshold for points acquisition or exchange, the scope of product rights and interests will be narrowed and the operating costs of credit cards will be reduced; On the other hand, some credit cards optimize the benefits for the upgrade of targeted customer groups. In the future, user experience will gradually surpass the extensive traffic acquisition thinking and become the key for commercial banks to build market competitiveness.
The new regulations of Ping An Credit Card have been implemented.
On December 15, 2023, Ping An Bank Credit Card Center issued the "Announcement on the Adjustment of Ping An Bank's Credit Card Points Rules", which will update the credit card points rules from February 1, 2024. Specifically, from February 1, 2024, only 7 credit cards, including Ping An Bank Platinum Credit Card, Ping An Bank Elite Platinum Card, and Ping An Bank Diamond Card, will retain WeChat and Alipay channel transaction points.
The new regulations make it clear that multiple points for consumption in special scenarios will be cancelled: involving 6 credit cards, including Ping An Bank Jufu Platinum Credit Card and Ping An Bank Chuangfu Platinum Credit Card. In addition, the new points rules apply to the issuance rules of the average monthly and daily asset consumption points of all the above special credit cards, that is, the issuance of points at the asset level of 10,000 yuan will be cancelled.
On January 12, 2024, the Credit Card Center of Ping An Bank once again issued the "Announcement on the Adjustment of the Points Issuing Rules for Special Credit Cards of Ping An Bank", in order to optimize the customer experience, it is proposed to supplement the points rules of Ping An Bank Good Car Owner Platinum Card Glory Edition, Ping An Bank Good Car Owner Platinum Card Premium Edition, and Ping An Bank Car Owner Platinum Card: Holders of the above card types can still get 1 time of Wanli points normally if they trade through Alipay and WeChat channels. The rules for accumulating points for consumption through other channels are the same as those for the new points. In the previous month, the rules for issuing points for average daily asset consumption in the previous month cancelled the rule of "40 points for every 30 yuan spent at the asset level above 10,000 yuan", and only the points for asset levels below 1,000 yuan and above 1,000 yuan were retained.
In fact, this is not the first time that Ping An Credit Card has adjusted its rules. On January 28, 2022, Ping An Bank Credit Card issued an announcement announcing the adjustment of its points rules. In terms of the point issuance model, Ping An Bank will issue points in different proportions based on debit account assets and credit card consumption. At the same time, the scope of points accrual transactions was further clarified, and the Ping An Pocket Bank app was added to open the banking mini program for consumption scoring to continuously improve the experience of using points.
Ping An Bank Credit Card is the first banking institution in China to write online consumption points into the points rules, and has attracted much attention in the industry. In this regard, some industry insiders said that compared with the points rules released in January 2023, the credit card points rules of Ping An Bank this time have a smaller range of points for third-party payment institutions. Except for special card types, Ping An Bank credit card bound to WeChat and Alipay channels will no longer accumulate points.
Equity "shrunk", and many banks adjusted intensively.
On November 15, the credit card center of Shanghai Pudong Development Bank announced that some high-end credit card rights and interests in 2023, such as Shanghai Pudong Development Bank Super Platinum Credit Card and American Express Platinum Credit Card, will not be renewed after expiration, and the scope of rights and interests adjustment includes mileage point redemption, flight delay insurance, etc.
Coincidentally. On November 14, the Postal Savings Bank announced that it would reduce the number of services for some rights and interests from 2024 and increase the requirements for consumption standards for some rights and interests. These include: the number of pick-up and drop-off benefits will be reduced from 4 to 2, and the number of pick-up and drop-off services of Platinum Credit Card (Wealth Edition) will be reduced from 6 to 2. In addition, the number of appointments for the Platinum Credit Card (Wealth Edition) Expert Account will be reduced from 6 times to 2 times.
On the same day, Bank of Communications announced that Bank of Communications would stop issuing new Bank of Communications Walmart credit cards on December 31. Starting from January 1, 2024, Walmart credit cardholders can enjoy the benefits of BOCOM's standard credit card of the same card level, and will no longer enjoy the right to redeem points for Walmart in-store card swipe. China CITIC Bank also issued the "Announcement on the Shelf Time of China CITIC Bank Credit Card Points Redemption Mileage Products" on November 14, stating that the shelf time of the bank's credit card points to redeem some airline miles will expire on December 31, 2023.
Judging from the adjustment of the rights and interests of credit card customers of some banks, the credit card rights of most institutions have been reduced in the majority, and the upgrades are relatively few, and banks may be more in the stage of optimizing credit card rights and reducing comprehensive operating costs. In this regard, Zhou Maohua, a macro researcher at the financial market department of Everbright Bank, said that in recent years, the cost of customer acquisition and operation of credit card business has risen, and the competition on the revenue side is fierce. The main reason for the above adjustment is to better balance the income of the credit card business with the operating costs.
The credit card market is moving towards an era of stock competition.
Points are one of the basic benefits of credit card users. In the interview, the reporter learned that the main forms of marketing carried out with points as the main body are as follows: one is to exchange physical goods in points**, the other is to exchange merchant electronic coupons, and the third is to deduct cash or credit card annual fees when paying. In addition to the changes in the points rules, some credit card users believe that the benefits related to points are "shrinking". For example, products that used to be redeemable with points now require more points to be redeemed.
Su Xiaorui, a senior observer of the banking industry, said that the shrinkage of some credit card rights may be related to the poor user activation effect brought by credit card rights and interests, and may also be related to the fact that some professional "wool" players take advantage of the loophole of "one machine and one code" in some payment terminals to obtain rights and interests. Against this backdrop, the appeal of swiping a credit card will be diminished, but the basic functionality of an overdraft will remain.
In fact, with the increasingly fierce market competition and the shrinking of incremental resources, the growth rate of credit cards in China has slowed down significantly in recent years, according to the "Overall Operation of the Payment System in the Third Quarter of 2023" released by the central bank, as of the end of the third quarter of 2023, the number of credit cards and credit cards in use is 77.9 billion, down 1% month-on-month.
China's credit card market is gradually moving towards the era of stock competition. As credit card growth slows down, customer acquisition costs increase, and credit card overdues increase, banks will consider reducing credit card benefits to strike a balance. In this regard, a person from the credit card department of a large state-owned bank said that compared with the previous scale, the current credit card is more focused on accurate customer retention, and is more inclined to build a "less but fine" equity matrix.
Zhou Maohua said that in the era of stock competition, the cost of traditional marketing customer acquisition of banks is rising, and how to improve the user's experience and stickiness is the core competitiveness of the credit card business. Under the trend of the gradual shift of credit card business to refined operation and management, it is not surprising that some banks will reasonably optimize their rights and interests in the future. However, it is necessary to strike a balance between profitability and customer satisfaction by satisfying the needs of expanding use cases and enhancing functional differentiation.
In Su Xiaorui's view, in the face of the dual challenges of high customer acquisition costs and declining issuance, banks need to pay attention to credit card APP, the main channel for customers to reach, and continue to optimize the interactive experience and functional experience in a targeted manner. In 2024, based on the new stage of intensive credit card cultivation, user experience will gradually go beyond extensive traffic acquisition thinking and become the key for commercial banks to build market competitiveness. (Reporter Zhong Yuan reports from Beijing).
Editor-in-charge: Li Ben.