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Card industry poised for growth

DCSTUDIO-FREEPIK

THE CREDIT CARD industry is expected to continue growing this year and next amid rising interest rates, an official from Asia United Bank Corp. (AUB) said on Monday.

“I think the credit card industry is on the right track for growth this year and next year,” AUB Senior Vice President and Cards and Acquiring Business Group Head Maria Magdalena V. Surtida said.

“We’re seeing very positive figures as far as the credit card industry is concerned. We’ve definitely recovered from the pandemic era. We are now in the post-pandemic and all we’re waiting for is the comeback of travel and everything will be okay,” she said.

She added that the bank saw a growing number of online transactions in terms of volume despite rising interest rates. The lender was also able to manage their nonperforming loans (NPLs) this year better compared with 2021.

AUB launched on Monday the Unified Card QR Link as the newest feature of AUB PayMate, enabling businesses to accept Mastercard and Visa payments using only one QR code.

According to Ms. Surtida, the latest product will allow all types of merchants, including the micro, small and medium enterprises (MSMEs), to accept digital payments from their customers.

“We’ve had very good reception when we introduced our Mastercard Card QR Link in the market in 2021, which was the first of its kind in the country. This is the reason we immediately developed a Unified Card QR Link so our AUB PayMate merchants can accept both Mastercard and Visa prepaid, debit and credit card payments from their customers,” she said. 

“For the MSMEs, this is our strategy because we know that there’s still a big opportunity out there. There’s a whole big size untapped market that we want to do a good job on. And we’ve just launched this so we want to spend the next few months saturating the market with our product,” she added. 

Merchants usually use point-of-sale (POS) terminals to accept Mastercard and Visa payments from their customers. However, the high transaction volume required by card merchant acquirers to deploy a POS terminal to merchants has been deterring MSMEs from accepting these card payments, AUB said.

“With the Unified Card QR Link, merchants, big or small, need not worry if they can meet the required volume of transactions as we made the card acceptance at no additional cost to them,” Ms. Surtida said.

The bank said customers only need to scan the Card QR code displayed on any AUB PayMate merchant stores to use the new feature. After completing a transaction, merchants can view the customer’s payment status in real time.

Since the product’s pilot launch in January, the bank recorded a 30% to 40% increase in transactions month on month from the unified card QR link, it said.

“Customers today are used to paying merchants by using their e-wallet app to scan the QR code,” said AUB Executive Vice-President and IT & Operations Group Head Wil Rodriguez said in a statement.   

“We leveraged this same customer experience and introduced the card QR link to accept Visa and Mastercard payments. The all-in-one PayMate App/portal can now support different types of payment transactions, including Mastercard and Visa,” Mr. Rodriguez said.

CREDIT CARD CAPWhen asked if AUB is asking for an increase in the 2% monthly ceiling on credit card interest, Ms. Surtida said it is “always on the table” every time they meet with the Bangko Sentral ng Pilipinas (BSP).

“But of course, BSP knows what they’re doing. They review macroeconomic factors and the different elements in the country or in the economy. So, we trust that the BSP will do the right thing every time, as they always do,” she said.

The Monetary Board in September 2020 set a 24% annual interest rate cap on all credit card transactions in an effort to ease the financial burden amid the pandemic-induced health crisis.

The rates are reviewed by the central bank every six months, in accordance with the BSP’s supervisory authority.

AUB Group booked a net income of P1.7 billion last quarter, 70% higher than the P998.3 million booked in the same period in 2021, based on its quarterly report disclosed to the local bourse.

This brought its net profit for the first nine months to P4.6 billion, up 57% from the P2.9 billion a year prior, which it noted already surpassed its pre-pandemic performance.

AUB’s shares closed at P41.05 apiece on Monday, up by P1.15 or 2.88% from its previous finish. — Keisha B. Ta-asan

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