The bank, which is China’s seventh largest lender in terms of total assets, has also said that it expects its credit card business to start making a profit in 2007. The lender’s credit card operations have been in the red since their inception three years ago.
The move is part of China Citic Bank’s strategy to enhance its operations and stay competitive in an increasingly saturated retail banking sector, Reuters said.
Market competition in the credit card business is very tough in China, as consumers still prefer cash and many Chinese banks prefer issuing credit cards to clients without charging them an annual fee, said Chen Jin, head of Citic Bank’s credit card center, cited in Reuters.
According to the publication, credit cards have only recently become a popular payment method in China’s most metropolitan areas. The upcoming Beijing Olympics, to be held in 2008, has prompted increased acceptance of credit cards in order to facilitate transactions.
Reuters reported that Citic Bank is aiming to initially target its credit card drive at its eight million debit card holders.
The Chinese banking sector has recently been opened up to allow foreign participation, which has prompted regional banks to try to enhance their competitive standing.
