THERE ARE GROUPS of planners in various consumer banks around the world that are sleeping much less than they should.
The China Banking Regulatory Commission has recently indicated officially that there is a possibility for foreign banks to issue credit cards on the mainland 'in the near future', and these planners are scrambling to understand the implications and develop scenarios for entry, depending on what the final official rulings are.
Generally, there is a widely accepted notion that the demand and supply gap for credit cards is enormous, especially in richer cities where wealthier consumers are increasingly experiencing the inconvenience of carrying a lot of cash when they buy big-ticket items.
There is also a general belief the growth for credit cards beyond filling this demand-supply gap will continue exponentially in the foreseeable future, unless something happens that drastically halts the economic growth of the mainland.
As income grows, card spending as a percentage of total spending also increases, because consumers will be spending proportionally less on stable items such as food and transport and more on dining out and luxury goods.
Additionally, as the use of credit cards become more of a habit, the portion of card spending that is unpaid at the end of the month, revolving balance, also tends to rise.