Aeon credit cards cut interest rates to follow Amex

Money-lender Aeon Credit Services (Asia) Co is to slash its credit card interest rate to 18 per cent from 24 per cent, following the footsteps of American Express.

Managing director Kazuhide Kamitani said yesterday the consumer finance company planned to prune the credit purchase rates of its six Affinity cards next month, after American Express launched an 18 per cent interest rate credit card in April.

The move came as Aeon sought to boost further its credit card weighting this year, switching its focus from personal loan business.

Credit card business - including Aeon cards, Affinity cards and Mastercards - contributed 72 per cent of $1 billion accounts receivable last year, a 10 per cent growth from the previous year.

'Aeon still has much room to expand in the market,' Mr Kamitani said. 'Everyone here has two credit cards on average while in the United States it is four to five.' He said Aeon would launch an Affinity card with Japanese department store Matsuzakaya and a charity card next month, taking the number of new cards this year to 10.

'We expect to issue about 100,000 new cards [for subscribers] this year, apart from the 20,000 issued before February,' Mr Kamitani said. 'By 1998, we plan to issue up to 400,000 new cards.' Most of the new cards would be Affinity cards which general manager Gerald Fong Chung-leung described as 'the best way to enlarge the cardholders base'.