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TMB banks on strong features, segmentation strategy in big push for credit card growth

TMB Bank is struggling to speed up its credit card business to close the gap with rivals by wielding a segmentation strategy.

In market awareness, TMB lags behind other credit card issuers, so it has to move aggressively to boost its market share. However, it should beat the competition with strong features, not short-term promotions, Kanchana Rojvatunyu, head of retail marketing, said yesterday.

The bank might not have been so active in the past but this year it will start to strongly promote its credit cards. It aims to expand both its credit cards in circulation and spending from existing customers who are not holding a TMB credit card yet and those who are new to the bank.

TMB targets spending on its plastic to grow 25 per cent to Bt25 billion-Bt30 billion this year while the credit card industry is expected to grow by 8 per cent.

Last year, TMB's cards grew 17 per cent against 12 per cent for the industry.

Card spending in the first five months of this year was hit by the political uncertainty, so double-digit growth in the credit card industry will not be easy, she said.

In the first five months, TMB's credit card spending was up 8 per cent, while the market was up only 4 per cent.

Yesterday, the bank launched the "So Smart" credit card to tap middle-income customers who prefer paying in full by offering 1-per-cent cash back. The cash will be transferred to a TMB non-fixed account.

Customers who want a So Smart card must open a TMB none-fixed account, as the bank wants to encourage people to save.

TMB has set up an outbound team to acquire So Smart cardholders. Outbound sales will focus on offering So Smart cards to the bank's 1.4 million none-fixed accounts.

The bank aims to issue 400,000 credit cards, of which 30,000 will be So Smart cards.

"The challenge of TMB is how to be in the top three of the main credit cards of customers, as individuals own three to four cards. Strong features is our strategy in keeping in touch with our customers," she added.

TMB had earlier launched So Chill credit cards to revolving customers and added so good features by offering a zero interest rate for three months to all TMB credit cards.

So Chill accounts for 40 per cent of TMB's 300,000 credit cards.

Bernard Coucke, chief retail banking officer, said the bank has left unchanged its retail loan growth target at 10 per cent even though the first five months missed the target. After the coup and the attempt to stabilise the economy by the National Council for Peace and Order, TMB hope consumer confidence will gradually improve in the second half, the cycle of business and spending, he said.

Retail banking represents 18 per cent of TMB's loan portfolio of Bt500 billion.


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