THE golden days when credit card business reported record growth may be over as aggressive new entrants have started to erode yields on card loans, a report published by Salomon Brothers predicts.
Competition has intensified recently, which points to a possible lowering of profit margins and a tougher environment ahead for credit card issuing banks.
Examples include Dao Heng Bank's aggressive strategy in expanding its card base after the merger with Overseas Trust Bank.
'In less than a year, it doubled the number of cards issued through aggressive marketing,' the report said.
Dah Sing Bank also introduced new methods of competition.
The programme offered cash rebates for every $200 purchase, every $4 interest paid and for transferring outstanding balances from other cards to Dah Sing card.
