Visa: Affluent segment still growing

Credit card spending here has not dropped significantly despite the fragile economy.
Credit card spending here has not dropped significantly despite the fragile economy.PHOTO: BLOOMBERG

The ranks of affluent people here are still increasing despite the economic slowdown, and plenty of them remain keen to splurge on travel, according to credit card provider Visa.

Cardholder numbers in the affluent segment - defined by Visa as those earning $120,000 and more annually - grew at a rate of 25 per cent year on year last year, higher than the overall cardholder growth of 11 per cent, Visa found.

Credit card spending here has not dropped significantly despite the fragile economy. Monetary Authority of Singapore data showed that card billings in January totalled $4 billion, down from $4.49 billion in December but still up 4.5 per cent from a year earlier.

Visa Singapore and Brunei country manager Ooi Huey Tyng said "travel also continues to be a key category of spending" for holders of Visa Infinite cards, which are used by affluent customers. "The segment intends to travel 50 per cent more", according to Visa research, she added at a briefing yesterday to launch a new Visa Infinite card from Standard Chartered Singapore.

The StanChart card, which is available only to those with a minimum annual income of $150,000, offers a package of privileges catering to travel needs, among other lifestyle rewards.

But competition is fierce for the affluent segment here, with 10 banks issuing Visa Infinite cards, each trying to match and exceed the perks and offers.

United Overseas Bank is also competing hard, with a market share of over 40 per cent and the highest card spend, a spokesman said.

UOB has also moved to strengthen its offering to young people with the launch of a new card yesterday that targets the millennial generation by offering rewards like priority access to bars and clubs, and deals on dining and travel websites. UOB regional head of cards and payments Jacquelyn Tan said: "Millennial spending currently accounts for 20 per cent of UOB's total card spend... We expect the number of our millennial customers to increase as we introduce more products that meet their lifestyle and banking needs."

Wong Wei Han

A version of this article appeared in the print edition of The Straits Times on March 31, 2016, with the headline 'Visa: Affluent segment still growing'. Print Edition | Subscribe