Henry Sy-led BDO Unibank is intent on aggressively growing its credit card business, confident that plans would receive a boost from the country’s growing middle class.
Strong consumer spending in the Philippines, fueled by remittances from migrant workers and booming industries such as business process outsourcing and tourism, means credit cards are primed for growth in the country.
“The middle class is growing and you see it all over,” said Nannette Regala, senior vice president and marketing head of BDO’s consumer lending group, in a press conference yesterday.
BDO currently has about 1.5 million credit cards in the Philippine market, spread across five brands, namely, Mastercard, Visa, Unionpay, JCB, and American Express. There are fewer than 7 million credit card holders in the Philippines.
With the improving prospects for the industry as a whole, competition has also become tighter. BDO on yesterday launched its American Express CashBank credit card. The new card gives back rebates on all transactions: 1 percent for domestic purchases, and 2 percent if used overseas.
Regal said the establishment of TransUnion, a credit bureau among major private sector banks in the country, made it easier in recent years for companies to find credit card clients.
The selection process has also improved as a result of the credit bureau, which helps companies share positive and negative information on borrowers. These improvements have led to lower delinquency rates for credit cards, Regala said.
Earlier this month, the government announced it would start collecting credit information for banks to be used by the newly formed state-run Credit Information Corp. (CIC).
CIC is a government-owned and-controlled corporation (GOCC). It serves as a central credit registry, collecting positive and negative credit data on borrowers and providing consolidated basic credit information to individuals, businesses, financial institutions, and private credit bureaus.