Central The 1 credit card, a co-branded card from Bank of Ayudhya (Krungsri) and Central Group, is aiming for double-digit growth in all areas this year thanks to higher consumer spending in the upper-income segment.
The card, operated by General Card Services Co under Krungsri Consumer, upgraded its business targets for 2022 after booking higher than expected growth for the first quarter this year, said Atis Ruchirawat, managing director of General Card Services and chairman of the Credit Card Club under the Thai Bankers' Association.
The company forecasts 81,200 new card acquisitions, growth of 52% year-on-year, and total spending of 88.2 billion baht, a gain of 16%. It estimates new personal loans via the card at 1.9 billion baht, or 13% growth, while total outstanding loans are expected to rise to 25 billion baht, a 10% increase.
In the first quarter, Central The 1 added 19,500 cards, recording 21% year-on-year growth, while card spending stood at 2.1 billion baht or 17% growth. New personal loans booked stood at 500 million baht, or 16% growth year-on-year.
Mr Atis said the overall credit card business, especially for co-branded cards focusing on the upper-income segment, showed signs of recovery from last year and positive growth continued this year.
The upper-income segment was not significantly affected by the spread of the Omicron variant, while purchasing power in that segment remains strong, he said.
Central The 1 credit card covers both the mass market, whose average spending is 15,000 baht per card per month, to the upper-income segment with spending levels ranging from 45,000 baht to 300,000 baht.
The upper-income segment on average contributes around 35-40% of total spending, while representing less than 10% of the total client base.
With a high-quality customer base, non-performing loans for Central The 1 credit cards stand at around 2%, which remains steady since last year. Although the credit card business and controllable asset quality are improving, the company will keep its existing criteria for credit card approval to maintain asset quality, said Mr Atis.
"We will maintain a strong criteria on new loan approval and continue monitoring the market, despite the market rebound," he said. "The firm has relaxed some debt payment conditions for credit card loans in line with the central bank's requirement to help customers with the impact of Covid-19."
