Hyundai Card avoids industry’s mobile rush

Pressed to find new sources of revenue amid persisting slow growth, the credit card industry now is in a dilemma whether to launch mobile card systems.

While most of the market’s top-ranking operators have launched or are planning to launch a mobile-only card, No. 3 player Hyundai Card said it would not jump on the bandwagon, raising questions.

“Other companies are busy launching mobile-only cards, but Hyundai Card has decided not to,” Chung Tae-young or Ted Chung, CEO of Hyundai Card and vice chairman of Hyundai Motor Group, recently wrote on his social media page.

“Despite some specialized benefits, these mobile-only cards offer a limited range of usage and are based on a relatively weak demand class.

“The same level of benefits can be provided through the company’s already existing fintech products, such as its app card service, which currently stands at the market’s No. 2 in terms of users.”

App cards are differentiated from mobile cards as the former is connected to an actual physical card whereas the latter exists only in the form of a mobile application.

Hyundai Card is the only card operator, among the top eight, to reject the new trend.

The most ambitious was Hana Card, which is striving for a new growth momentum after taking over Korea Exchange Bank Card last year.

“For the first time since the credit card was invented back in 1950s, it has broken free from its plastic format,” said CEO Chung Hae-boon, while giving a demonstration of Mobi One, the company’s first mobile-only card.

KB Kookmin Card, too, quickened its step and launched four mobile cards last week.

“Currently, one needs to be a subscriber of one of our conventional credit cards in order to apply for these mobile-only cards,” said an official of the card company.

“But we will gradually expand the range to our debit card users as well as new customers.”

By Bae Hyun-jung (tellme@heraldcorp.com)