Strategy
Banks Turn To Credit Cards To Tap Asia's Affluent
American Express and the leasing arm of Australian lender Macquarie have tied up to launch an initiative allowing cash-strapped entrepreneurs to finance themselves using their Amex card.
American Express and the leasing arm of Australian lender
Macquarie
have tied up to launch an initiative allowing cash-strapped
entrepreneurs to finance themselves using their Amex card, the
latest example of an Asian bank sweetening its offer with niche
credit cards.
Antipodean business owners can now pay for their commercial
equipment and
vehicles through their American Express card. The programme is a
global first for
American Express within the commercial equipment finance
space, and
Macquarie
Leasing is the only institution in the market to accept
plastic for new
commercial vehicle and equipment finance repayments.
As part of the offer, Macquarie Leasing will accept
American Express for monthly payments for new commercial hire
purchase, chattel
mortgage and finance lease agreements. Macquarie Leasing also has
the ability
to source cars and insurance products on behalf of American
Express card
members.
"This is a great opportunity for business owners to
diversify the way they pay for their business equipment needs -
from car to medical
equipment finance arrangements. In addition, business owners can
benefit from a
convenient method of payment with the added advantage of being
able to extend
their cash flow,” said Joanne Sully, vice president, global
merchant services,
American Express.
"Business owners can now use their American Express Card to
pay for commercial vehicle and equipment finance repayments and
in doing so,
will earn more Membership Reward points - which can ultimately be
put back into
their business,” she added.
"Macquarie Leasing is delighted that we can assist
Australian businesses by expanding the range of vehicle and
equipment financing
solutions available in the market, a result of our continued
commitment to SMEs,”
said Andrew Sidery, head of Macquarie Leasing specialist sales.
It is the latest example of a bank offering a sweetener to
new
and existing clients through its credit cards - in what could be
a worrying trend, given the fresh memories of the global credit
crunch. Global banks invested heavily in
Asia-Pacific during the boom years, and many are finding their
cost to income
ratios are growing uncomfortably high. In a bid to grow new
assets, several are
seeking to expand their loans pool, offering privileges to loyal
customers
through credit cards.
US lender Citi's Hong Kong division this week sealed a
partnership with
lifestyle concierge firm Ten Group, available to all of its
clients with an
Ultima card. The Citibank Ultima Card is strictly by invitation.
Customers normally will have at least HK$8 million($1 million)
AUM with the bank or HK$3 million annual income. Finance charge
is 2.33 per cent per month. APR is 31.89 per cent (retail
spending); 33.61 per cent(cash advance).
Citi also separately announced it had gained approval to offer
its
credit cards in China, as one of the first foreign lenders to get
the green
light.
In December UK-listed Standard Chartered’s Islamic banking
arm
rolled out Islamic financial services, including credit cards,
for its clients
in the Middle
East.
Meanwhile India’s HDFC Bank
also in December launched premium credit cards targeting female
clients.
The new card,
Solitaire Premium, has a credit limit of nearly $10,000. The
lender said it
wants to increase its credit card clientele by 4 million over the
next two
years – or 10 million credit cards.
The bank is currently the biggest issuer of credit cards in
the
country and has around six million credit card customers, 1.5
million of whom
are women.