China Credit Card Marketing Market Report 2020
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Report Summary
Everything you need to make the right decisions
Providing the most comprehensive and up-to-date information and analysis of the Credit Card Marketing – China market including the behaviours, preferences and habits of the consumer.
Mintel has the answers you’re looking for
What are the key challenges facing the industry? Who is the consumer and what do they want? Where are the opportunities, where are the risks and what lies ahead?
Covered in this report
The China credit market is constantly evolving, especially in tandem with technological advancements that will be accelerated by the rollout of 5G, as well as the impact of COVID-19 that has pushed many businesses to embrace digital transformation faster than the industry could have imagined. At the same time, key markets in top tier cities are approaching saturation, forcing banks to expand their portfolio in new markets. As leading players increasingly face digitally savvy consumers whose profiles are quite different from their existing credit and loan customers, they must overcome the challenge of understanding these new target markets, to find their own competitive advantages and align them with what is important to consumers when choosing credit providers.
Expert analysis from a specialist in the field
Written by Hui Tse Gan, a leading analyst in the Finance sector, her extensive knowledge delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.
Consumers are familiar with credit and consumption loan products, which have become easily accessible through various online financial services. However, credit cards have continued to maintain a healthy level of interest among consumers despite the challenges posed by the regulatory and competitive environment. Going forward, banks are poised for new growth with their increased investment in building a robust financial technology ecosystem, consolidating their customer strategies to retain regular card users, convince young mobile-first consumers and underserved users to participate, while expanding their presence into new markets, through innovative products, services and rewards that are more thoughtful, accessible and secure.
Hui Tse Gan
Finance Analyst
Table of Contents
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Overview
- What you need to know
- Covered in this report
- Financial institutions
- Credit and consumption loan products
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Executive Summary
- The market
- Impact of COVID-19 on the credit and consumption loan sector
- Figure 1: Summary of impact of COVID-19 on credit card marketing, October 2020
- Market size
- Figure 2: Accumulated number of credit cards issued by year end, 2014-2019
- Steady consumer spending growth
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- Figure 3: Growth in total consumer expenditure and bank loans approved, 2015-2019
- Online credit faces both opportunities and challenges
- Figure 4: Growth in mobile payments by China’s banks, number of transactions and value, 2015- 2019
- Companies and Brands
- Declining growth in credit cards
- Figure 5: Number of credit cards issued by major banks, 2017-2019
- The consumer
- Credit and consumption loan usage
- Figure 6: Total credit and loan products usage, June 2020
- Credit spending
- Figure 7: Total monthly credit bill amount, June 2020
- Credit bill repayment
- Figure 8: Monthly credit bill repayment, June 2020
- Most frequently used credit card providers
- Figure 9: Most frequently used credit cards, June 2020
- Reasons for choosing credit card providers
- Figure 10: Reasons for choosing credit card providers, June 2020
- Innovate beyond conventional rewards for co-branding
- Figure 11: Interest in types of cooperation for affinity credit cards, June 2020
- What we think
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Issues and Insights
- Drivers of credit and consumption loan
- The facts
- The implications
- Reimagine the role of credit
- The facts
- The implications
- Innovate for advantage
- The facts
- The implications
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The Market – What You Need to Know
- Declining growth rate of credit cards issued
- Credit transactions grow but outstanding balance is falling
- Regulatory changes restrict non-bank fintech services
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Market Size
- Slower growth in credit cards issued by major banks
- Figure 12: Accumulated number of credit cards issued and credit cards per capita, 2014-2019
- Local banks expand their credit card businesses
- Figure 13: Credit card business as a share of consumption loans at local banks, 2019
- 5G rollout to support growth in mobile payments and credit services
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- Figure 14: Growth in mobile payments by China’s banks, number of transactions and value, 2015- 2019
- Slower growth in credit cards issued by major banks
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Market Drivers
- Steady consumer spending growth
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- Figure 15: Growth in total consumer expenditure and bank loans approved, 2015-2019
- Credit card spending
- Figure 16: Growth in credit card transaction/spending, 2019
- Investment in financial technology
- Credit card outstanding balance
- Figure 17: Credit card outstanding balance growth rate at the six major banks, 2011-2019
- Short term consumption loan growth
- Figure 18: Short term consumption credit as a share of short term loans, 2015-2019
- Competition from digital financial services
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Key Players – What You Need to Know
- Declining growth rate in credit cards issued by major banks
- Consolidating for competitive edge
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Market Share
- Declining growth in credit cards issued by major banks
- Figure 19: Number of credit cards issued by major banks, 2017-2019
- Declining growth in credit cards issued by major banks
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Key Fintech Players’ Performance
- Alipay Huabei and Jiebei
- Figure 20: Alipay Huabei and Jiebei as a share of Alipay’s microloans business, June 2020
- JD Baitiao
- WeChat Weilidai
- Bytedance
- Alipay Huabei and Jiebei
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Competitive Strategies
- Consumer segmentation and targeting
- Differentiate current rewards to excite existing customers
- Exclusive privileges for high income earners
- Digitisation is key to capturing lower tier cities
- Investment in financial technology
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Who’s Innovating?
- China Minsheng Bank’s Innovative Credit Card Usage Model
- Figure 21: China Minsheng Bank’s “Everyone’s Lifestyle” App, featuring “Everyone’s Easy Instalment”, June 2020
- WePlus Card: Guangfa Bank, Tencent and Visa for Overseas Spending
- Figure 22: WePlus Card, May 2020
- Ping An Bank Credit Card Division’s “88 Livestreaming Gala”
- Figure 23: Poster promoting Ping An Bank’s 88 Livestreaming Gala Event, August 2020
- China Minsheng Bank’s Innovative Credit Card Usage Model
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The Consumer – What You Need to Know
- Online credit and consumption loan services dominate in China
- Credit usage is defined by consumers’ habits
- Reduce psychological barrier of entry to credit and loan products
- Marketing to high potential consumers
- Guarantee of personal data protection as a point of differentiation
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Usage of Consumption Credit and Loans
- Online payment and credit services dominate in China
- Figure 24: Total credit and loan products usage, June 2020
- Demographic differences in consumption credit usage
- Figure 25: Usage of consumption credit products, by gender, June 2020
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- Figure 26: Usage of consumption credit products, by generation, June 2020
- Credit cards are more popular with high income earners
- Figure 27: Usage of consumption credit products, by monthly personal income, June 2020
- Open-minded towards credit in lower tier cities
- Figure 28: Usage of consumption credit products, by city tier, June 2020
- Lower usage in consumption loan products
- Figure 29: Usage of Jiebei and Weilidai compared to credit cards, by city tier, June 2020
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- Figure 30: Usage of Jiebei and Weilidai compared to credit cards, by region, June 2020
- Online payment and credit services dominate in China
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Credit Spending
- Most consumers are careful about credit spending, especially 18-24s
- Figure 31: Total monthly credit bill amount, June 2020
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- Figure 32: Monthly credit bill amount, by age, June 2020
- The big credit spenders: older and female
- Figure 33: Monthly credit bill amount, by gender and age, June 2020
- Family structure affects credit and loan needs
- Figure 34: Monthly credit bill amount, by family structure, June 2020
- Income and employment affect willingness for credit spending
- Figure 35: Monthly credit bill amount, by monthly personal income, June 2020
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- Figure 36: Monthly credit bill amount, by employment, June 2020
- Most consumers are careful about credit spending, especially 18-24s
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Credit Bill Repayment
- Almost two-thirds of respondents always pay in full
- Figure 37: Monthly credit bill repayment, June 2020
- Payment flexibility allows families to manage their disparate cash flow needs
- Figure 38: Monthly credit bill repayment, by family structure, June 2020
- Users in lower tier cities use credit instalments to navigate financial challenges
- Figure 39: Monthly credit bill repayment, by city tier, June 2020
- Almost two-thirds of respondents always pay in full
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Most Frequently Used Credit Card Providers
- China Construction Bank and China Merchant Bank most popular
- Figure 40: Most frequently used credit cards, June 2020
- The most popular cards have clear consumer segmentations
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- Figure 41: Most frequently used credit cards, by age group, June 2020
- China Construction Bank and China Merchant Bank most popular
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Reasons for Choosing Credit Card Providers
- Ease of use is consumers’ baseline expectation…
- Figure 42: Reasons for choosing credit card providers, June 2020
- …Privacy protection can be a differentiator for certain consumers
- Figure 43: Personal data protection, by age, monthly personal income, city tier, June 2020
- Shopping benefits are attractive to female users and older users
- Figure 44: Selected reasons for choosing credit card providers, by age and gender, June 2020
- Higher credit amount is key to improving spending power
- Figure 45: Higher credit amount, by monthly household income, June 2020
- Users with high personal income fully leverage credit card benefits
- Figure 46: Reasons for choosing credit card providers, by monthly personal income, June 2020
- Ease of use is consumers’ baseline expectation…
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Affinity Credit Card Co-branding Preferences
- Online and offline shopping co-branding still an overall favourite
- Figure 47: Interest in types of cooperation for affinity credit cards, June 2020
- Physical and digital benefits appeal to different age groups
- Figure 48: Interest in types of cooperation for affinity credit cards, by age, June 2020
- High income earners drawn to health and travel privileges
- Figure 49: Interest in types of cooperation for affinity credit cards, by monthly personal income, June 2020
- Attract families with lifestyle-related services
- Figure 50: Interest in types of cooperation for affinity credit cards, by family structure, June 2020
- Unique co-branding opportunities to capture young consumers
- Figure 51: Interest in types of cooperation for affinity credit cards, by age, June 2020
- Online and offline shopping co-branding still an overall favourite
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Meet the Mintropolitans
- The MinTs are versatile credit users
- Figure 52: Usage of credit and consumption loan products, by consumer classification, June 2020
- Lower interest or fees for instalment repayment
- Figure 53: Monthly credit bill repayment, by consumer classification, June 2020
- Privacy matters as digital transformation accelerates
- Figure 54: Reasons for choosing credit card providers, by consumer classification, June 2020
- Exclusive privileges for the MinTs
- Figure 55: Interest in types of cooperation for affinity credit cards, by consumer classification, June 2020
- The MinTs are versatile credit users
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Appendix – Methodology and Abbreviations
- Methodology
- Abbreviations
About the report
This market report provides in-depth analysis and insight supported by a range of data. At the same time, introductory and top-level content is provided to give you an overview of the issues covered.
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