Krungthai Card has assigned its collection team to monitor the increase in cash advances by its credit-card holders in the first five months of the year to keep non-performing loans down.
Pittaya Vorapanyasakul, executive vice president for the credit-card business, said the economic slowdown was one reason for the increase in cash advances, which it founded in majority credit cardholders who have monthly income of Bt15,000-Bt40,000. The company will not adjust its card-issuing criteria but its collection team will keep an eye on the situation.
Cash advances in the first five months expanded by 10 per cent to Bt7.5 billion, accounting for 15 per cent of the total portfolio, up from 14 per cent last year.
She said this proportion of around 14 per cent had been stable for many years, and while it had climbed by a percentage point, overall credit-card spending in the first five months had grown by only 5 per cent. That is well below the full-year growth target.
KTC has projected total credit-card spending this year of Bt138 billion, up 15 per cent from Bt120 billion last year, while the number of new credit cards is projected at 440,000 against 160,000 last year.
In the first five months, KTC issued 100,000 new credit cards.
Pittaya said it would be a big challenge to meet its growth goal as spending in the first two months plunged before improving in March.
The night-time curfew imposed last month had an impact on credit-card spending in the retail and dining categories. However, after the curfew has been lifted in many provinces, including popular tourist destinations, credit-card spending is expected to improve, she said.
"We have not changed the target in terms of new credit cards issued and spending as consumer sentiment is positive after the coup. Customers and [business] operators have seen a certain direction even though the country has still not had an election. The first sign we have seen is the resumption of marketing promotions by retail fashion operators," she said.
KTC and its partners still offer promotions because customers are still looking for good-value deals. She added that the company would launch new products and campaigns next week to boost spending in the second half in a bid to achieve its target.
"New products will be aimed at the upper-income segment and active cardholders," she said.
The firm yesterday joined with more than 60 popular hotels and resorts in a campaign to stimulate spending on dining, accommodation and travel items.
Prym Panyasereeporn, KTC vice president for travel and leisure marketing, added that in the first quarter, members spent more than Bt800 million on reservations, dining and spas at hotels. This accounted for 35 per cent of all travel expenditure.