Business / Companies

HSBC to roll out own credit cards in Chinese mainland

(Agencies) Updated: 2016-07-08 09:10

HSBC Holdings Plc is aiming to roll out its own credit cards in the Chinese mainland by the end of the year, as the United Kingdom-based lender tries to tap into rising online and mobile spending in the world's second-biggest economy.

The bank will initially target customers in the Pearl River Delta, the manufacturing hub located just north of Hong Kong, with the HSBC-branded cards, according to Kevin Martin, the firm's Asia-Pacific head of retail banking and wealth management.

The bank, which already has co-branded cards in China through a partnership with Bank of Communications Co, received regulatory approval earlier this year for its own mainland offerings.

Martin said the cards business was "the critical deliverable" for the bank this year.

"Our ambition in the PRD is to build a full scale, digitally driven retail banking and wealth-management business and the launch of HSBC-issued credit cards in the mainland is key to this strategy," he said in a recent interview in his Hong Kong office.

Retail banking and wealth management accounted for almost 30 percent of the bank's Asian pretax profit in the first quarter, filings showed.

As more Chinese move online to pay for goods and services, HSBC is hoping they will use its cards for purchases, thereby luring more customers to its retail bank. This will allow it to promote personal lending, wealth-management services and other products to the new credit-card customers, according to Guotai Junan Securities Co analyst Richard Cao.

Martin declined to provide specifics on the digital features that will underpin HSBC's new cards.

Citigroup Inc and Bank of East Asia Ltd, the other foreign banks approved to issue credit cards, offer digital-payment services on the mainland with Alipay, Alibaba Group Holding Ltd's payment affiliate, and Tencent Holdings Ltd's WeChat.

HSBC's broader push into the PRD, home to 58 million people with an economic output that exceeds the Netherlands, is not without its challenges.

China's slowing economy has prompted Chief Executive Officer Stuart Gulliver to ease the pace at which the London-based lender is hiring 4,000 employees for the area.

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