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Race for leadership heats up in local credit card market

(Yonhap)
(Yonhap)
Runners-up in the local credit card sector increased their market shares in the April-June period, upping the ante against South Korea’s largest card issuer, Shinhan Card, data showed Thursday.

Overall sales from personal and corporate credit cards issued by the nation’s seven leading credit card companies, including Samsung Card, KB Kookmin Card and Hyundai Card, came in at 140.3 trillion won ($121.2 billion) in the second half, according to the state regulator, the Financial Supervisory Service.

During the three-month period, nearly all the credit card firms saw their market shares increase. A notable exception was Shinhan Card, the No. 1 credit card firm by revenue.

Shinhan’s market share shrunk by 0.64 percentage point quarter-on-quarter to 21.33 percent, with its sales reaching 29.9 trillion won. Although the company, which merged with LG Card in 2007, has maintained the top spot for years, its market share has been on a downward trend as of the last quarter of 2018.

Other players have been catching up in recent months. Samsung Card’s market share increased 0.49 percentage point in the second quarter to 18.16 percent, while that of KB Kookmin increased 0.21 percentage point to 17.92 percent.

As the data shows, competition between the second- and third-ranked companies is getting fierce. In the first three months, KB Kookmin outran Samsung in terms of market share for the first time in years, but Samsung took second place during the April-June quarter.

Maintaining the upward momentum it has enjoyed since the fourth quarter of 2018, Hyundai Card marked 16.6 percent market share, up 0.32 percentage point, during the cited period.

The market share gap between Shinhan and Samsung stood at 3.55 percentage points in the second quarter last year, but the figure has narrowed to 3.17 percentage points, signaling that the race for the top spot will pick up pace down the road.

The increased market presence of the runners-up is attributed to their aggressive marketing and sales strategies.

KB Kookmin is ratcheting up sales efforts to attract corporate customers and expand automotive financing operations, while Samsung is said to have made a push to grow its corporate card business further during the second quarter of this year.

“Nowadays, it is hard for one company to have an overwhelming market position as in the past,” said an official from the credit card segment. “Development of new services, and various revenue sources are considered more important than anything.”

By Kim Young-won (wone0102@heraldcorp.com)
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