Security Bank and Trust Co. has launched its credit card line for the middle income market with the issuance of its Platinum Mastercard.
Security Bank is already in the high-value market with its Diners Club cards.
“We are looking at entering the middle executive level and young executives of the card market,” said Andrew D. Cajucom, SB Cards Corp. vice president, during the formal launch. SB Cards is a subsidiary of Security Bank.
Cajucom said that the card business is part of the bank’s consumer banking business which includes mortgage and auto loans. The card business contributes a little over 10 percent of the consumer banking business.
Last year alone, the bank issued 60,000 cards, both MasterCard and Diners Club. A modest annual growth rate of 10 percent is seen for 2008.
Security Bank chief finance officer Carlos Borromeo said consumer spending will continue to grow, thus they want to take advantage of the various opportunities for banks.
The credit card market in the Philippines is “under-tapped,” Borromeo said, adding that the acceptance of plastic money is on the rise as more consumers use their credit card to settle bills for “financial flexibility.”
Borromeo added that they have a low default rate of between five to seven percent as against the industry average of over 14 percent.
He traced this to the bank’s fastidious process plus a more focused target market.
Borromeo stressed that Security Bank does not plan to compete with the domestic and foreign banks which has been in the plastic money business in a big way.
Cajucom said the spending pattern of the Filipino consumers have changed and now requires specific financial products to suit clients’ preferences.
“The credit card business follows the same path,” said Cajucom, relating the spending pattern of the consumers to the acceptance and usage of plastic money.