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| Card firm CEOs listen to then Financial Services Commission Chairman Choi Jong-ku during a meeting at the Government Complex Seoul in this April 2019 file photo. / Yonhap |
By Park Jae-hyuk
Credit card issuers are accelerating their digital transformation drive this year amid worsening market conditions, falling growth rates and intensifying government regulations, according to the companies, Tuesday.
They are expected to emphasize this during a forthcoming meeting with Financial Services Commission Chairman Eun Sung-soo this Thursday.
According to Hana Institute of Finance researcher Park Ji-hong, card firms will not be able to avoid declining profitability in the long run, although their efforts to cut costs may improve their profits slightly this year.
"They should seek new businesses here by developing innovative financial services," he said. "Eventually, they need to expand their global presence, escaping the domestic market's boundaries."
Against this backdrop, the CEOs of local card firms have unveiled plans for digitization in their New Year messages.
Lim Young-jin, head of business bellwether Shinhan Card, urged his employees to be prepared for a futuristic payment market using mobile devices, biometrics and the internet of things.
"We will lead the digitized use of credit cards affiliated with super-individual marketing," he said.
Samsung Card CEO Won Gee-chan, who has led the runner-up company since 2013, vowed to enhance his company's ability to analyze data and utilize digital technologies, as he expects competition with large tech firms will become fiercer this year.
Lee Dong-cheol, KB Kookmin Card's CEO, called for efforts to adopt new technologies, read the trends with a new perspective, and lead the market.
Lotte Card boss Kim Chang-kwon said: "We should advance and speed up our digital innovation."
Hana Card CEO Chang Kyung-hoon asked his employees to develop the company into a "digital payment firm" by digitizing the firm's entire business procedures.
Chung Tae-young, the CEO of Hyundai Card, who did not announce a New Year message, is planning to enhance his company's enterprise value through digital businesses based on artificial intelligence.
Their attempts are drawing keen attention from observers who have been wondering whether their market shares will change or not.
According to the Financial Supervisory Service, Shinhan Card accounted for 22 percent of the credit card market as of the third quarter of 2019, followed by Samsung Card with an 18 percent market share, KB Kookmin Card with 16.5 percent and Hyundai Card with 15.3 percent.
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