Credit Card Business Continues To Grow, Banks Supervise Customer Risk Profile

Illustration. (Photo: Doc. Antara)

JAKARTA - In line with the increasing public consumption amid stable national economic growth, banks will continue to boost the growth in credit card ownership as needed by customers. However, the payment solution will still depend on customer revenue and risk profiles to avoid the red value of consumer credit performance due to soaring defaults.

Banking observer Paul Sutaryono said, in principle, banks always follow customers. Therefore, banks must be able to understand, not only the needs (needs), but also the desire (wants) of customers. The presence of a low-limits credit card is the bank's response to meeting customer needs and desires, as well as to balance the presence of paylaters.

"Banks like it or not have to face the onslaught of paylaters and digital wallets now and in the future in meeting customer needs, so that the bank market is not eroded. Low-limit credit cards are the way banks fend off the risk of attacking payments similar to credit cards," he said, Sunday, October 22.

Paul added that he believes credit cards will still grow despite being overshadowed by many competitors. Therefore, banks must act creatively and innovatively to provide added value to customers (value creation). He gave an example, banks can create cardless credit cards, including launching their own paylaters.

"Not many banks have played here, but this is one way to compete. This step should be appreciated," he said.

As is known, currently many banks offer a number of credit cards to customers. The credit card has different limits according to the customer's income level. Before issuing the credit card, the bank did BI Checking and SLIK OJK to find out the customer's risk profile through the score or credit rating from the check.

As regulated by regulations, the issuance of new credit cards is addressed to customers who have a minimum monthly income of IDR 3 million, and every customer with an income of IDR 3 million - IDR 10 million can only own and use two credit cards from different publishers.

The credit score, which is determined by the compliance of paying each customer, strongly determines the approval of granting credit card facilities, including the limits allowed for use.

Bank Indonesia noted, throughout the first semester of 2023 the growth of the credit card business reached 26.53 percent YoY, with a transaction value of IDR 33.67 trillion, in line with the increase in transaction volume by 14.1 percent. The number of credit cards currently circulating reaches 17.59 million units.

The growth in the credit card business is predicted to increase ahead of the Christmas and New Year holidays as each year, due to increased public consumption, especially in the tourism sector and online shopping in a number of e-commerce.

Unsecured Business Head of PT Bank Danamon Indonesia Tbk Tresia Sarumpaet said, in distributing each credit, including credit cards for consumer credit needs, his party always refers to the principle of prudence. Assessment of risk profiles is important to help customers enjoy added value in a sustainable manner from the payment solutions provided.

On the other hand, as a bank that is oriented towards customer needs, Danamon is committed to being present at every stage of customer life. Therefore, Danamon has a series of credit card products that are adjusted to the ability and financial needs of each customer.

Danamon provides the Danamon Grab Credit Card which is intended as the first credit card for a young generation to actively transact digitally, then the Danamon JCB Credit Card Precious to meet the lifestyle needs of the upper middle segment which has aspirations to optimize finance and lifestyle, to the Danamon American Express hope Card which is intended for the affluent and high net worth segments, which are synonymous with special and luxury services.

We want to help millions of people to achieve prosperity. That is why Danamon always obeys every applicable regulation in terms of providing credit card facilities, while continuing to provide periodic education to the public. The goal is that customers can wisely choose the right credit card product with their profiles, financial conditions and needs, and prevent customers from the risk of default," he stressed.