BC Card is ramping up its business expansion by increasing the number of its own card members. As its core payment network service has declined, it is diversifying its business structure through the expansion of its own card sector.
According to the Credit Finance Association on the 31st, as of June, the number of individual members of BC Card's own credit card reached 3,308,000, a 32.7% surge compared to the same period last year. Compared to the growth rates of other major card companies (Lotte, Samsung, Shinhan, Woori, Hana, Hyundai) which were in the range of 1% to 4% during the same period, this denotes a remarkable growth trend. The industry consensus is that attracting new members is challenging in a saturated card market.
BC Card focused on its own card sales in the first half of this year. This month, it held an event where new customers of its own card brand "BC Baro Card" could receive points worth 50,000 won if they referred a friend as a member. It also provided benefits that offered a certain percentage (1.5% to 3%) of cashback, regardless of domestic or international usage during the same period.
Recently, BC Card has seen a series of client departures, leading to a decline in revenue from its core payment network service. The payment network business consists of securing merchants nationwide and handling transaction processing and settlement tasks for banks and card companies for a fee. With an increasing number of companies acting as agents for merchant expansion, financial institutions no longer need to pay fees to remain a member of BC Card.
Since 2022, member companies including NongHyup Bank and Hana Card have established their own payment networks, leading to exits from BC Card's network. The only remaining dedicated bank, Woori Bank, also announced the establishment of its own payment network, withdrawing from BC Card membership. It is reported that Woori Card accounted for about 40% of BC Card's payment processing revenue. Consequently, profitability has been steadily declining. BC Card's net profit in the first quarter of this year was 35.1 billion won, down 29.8% compared to the same period last year.
BC Card began to actively promote its own card business in 2021 to restructure its business but has yet to see substantial revenue. In the first quarter of this year, BC Card's revenue from its own card transaction fees was 13.6 billion won, up 58.1% compared to the same period last year (8.6 billion won), but it only accounted for a mere 1.6% of total revenue. The proportion of 'active members' who regularly use their cards each month among the total membership is 18.1%, which is lower than other companies in the 70% range.
A BC Card official noted, "We focused on securing members by offering low annual fees," adding that "we plan to launch additional cards with various benefits in the second half of the year."