Amex tempts customers of rivals with low rates
American Express has set the ambitious targets in Hong Kong of doubling the number of cards issued and tripling the amount of account receivables in three years despite the difficult economic environment.
Newly appointed general manager for Hong Kong John Steward said: 'In tough times like this it's more important than ever that people really focus on smart money management'.
This belief underpins the company's aggressive stance in expanding its 'balance transfer business' - encouraging customers to move their outstanding card balances with other card companies to American Express by offering a lower interest rate.
The company charges customers an annualised interest rate of 21.9 per cent on outstanding card balances, compared with a range of 24 to 30 per cent offered by competitors.
Mr Steward estimated this interest-rate differential could mean a total saving of up to $1 billion a year if all card users in Hong Kong transferred their outstanding balances to American Express.
He said the company's key strategy for growth in transaction volumes during a period of subdued consumer confidence was to provide card users with incentives to consolidate their spending on to the American Express card.
The company has been positioning its cards as a tool for everyday spending by linking up with grocery chains and petrol stations.