KoreaToday Shinhan Card Seeks to Expand Loyal Customer Base
By Lee Hyo-sik
Staff Reporter
Shinhan Card, Korea's largest plastic issuer, is looking to assert its leading position in the local market this year and join the league of global credit card companies through sustainable growth and positive synergy effects with its affiliates.
Additionally, Korea's No. 1 credit card firm will make every effort to find new engines of growth and expand its presence overseas, with a vision to become a world-wide leading card company that goes beyond the boundaries of Asia and leads the future of the local card industry.
Based on successful integration with LG Card and strong performance over the past two years, despite the global financial crisis, Shinhan Card CEO Lee Jae-woo said the company will overhaul its cost structure and capitalize on strong customer base of its parent company Shinhan Financial Group, the nation's largest financial holding company in terms of market capitalization.
``We will do our best to attract more loyal customers and maximize synergy with other group affiliates. We will also try to achieve balanced growth based on sustainable management,'' Lee said, adding the company has set up four strategic initiatives to accomplish its long-term goals.
In October 2007, the former Shinhan Card and LG Card were integrated as the new Shinhan Card. The integration of the two resulted in a strong customer base ― with the number of active card-holders reaching 13.6 million and a market share at 24 percent at the end of 2008.
The number of customers increased to 14.3 million and handled transactions worth 106.3 trillion won in 2009, generating 860 billion won net profits.
``First, we will solidify our industry leadership by building strong customer base and maximize customer value by improving our products and services on a continuing basis. We will further systematically operate our company-wide risk management system to better cope with downside risks in the future,'' the CEO said.
Secondly, Shinhan will make an all-out effort to improve its brand image, and set up a creative and future-oriented corporate culture. ``We will also develop models for maximizing synergy within the group, establishing a foundation for mid-to long term growth.''
Lee then said the firm has been promoting customer information sharing among group subsidiaries through the integrated customer relationship management (CRM) and implement customer loyalty program, adding it has further strengthened the group's synergy sales structure.
``We will continue to introduce new types of hybrid financial product, offering real benefits to customers. For instance, they can use mileage points to conduct a range of financial transactions, including investments in equity funds and paying insurance premiums and interests. We will do our best to make Shinhan Korea's most balanced financial group between banking and non-banking businesses,'' he stressed.
Lee also said the card issuer will develop innovative products and services based on convergence with other business sectors, as well as find future growth engines and new sources of income.
To boost customer satisfaction and worker productivity, Shinhan Card has been seeking to optimize its operation platform by employing ``six sigma'' campaign to ensure long-term sustainable growth. Believing that efficient management is the key to survival, CEO Lee has been spearheading the management innovation campaign since 2008.
Reflecting the card issuer's strong performance against the worldwide economic downturn, one of the three major global credit ratings agencies, Fitch, raised its rating for Shinhan Card to A- with a ``stable'' outlook in September 2009 from the previous BBB+ with the same outlook.
``The ratings hike means that we have successfully tided over the global crisis through the preemptive risk management, and improved bottom line. We will continue to solidify our position as a market leader by further bringing down default rate and maintain the sound capital base,'' Lee said.
To emerge as a global player, Shinhan Card has been seeking to make inroads into Southeast Asian countries.
``We have established a strategic business partnership with Japan's leading credit card firm JCB International, which has become one of widely recognized global card brands and accumulated know-how in exploring offshore markets. We will also make the best use of overseas branch offices of Shinhan Bank, particular those in Asia, and issue credit cards to bank customers,'' Lee said.