OREANDA-NEWS. February 02, 2012. Mr. Li, a resident in Nanjing, is in high-spirit recently because of his long-held wish of driving own car finally coming true before end of last year. The shortage of savings on hand stopped the thought although the wish of buying a car had been lingering in the mind for some time. Mr. Li, after applying for a Easy Time credit card from ICBC, uses the card to buy a car and repay the loan by installment reasonably set according to own salary and income. So, he becomes a car owner, reported the press-centre of ICBC.

As China economy staying on a fast and healthy growth trajectory and the change in people's attitude in buying and spending, more and more Chinese residents follow Mr. Li to pay large items by credit card. Take ICBC as an example, in 2011, the total value of transactions using ICBC bank cards surpassed RMB 3.2 trillion, a jump of around 43% over previous year. The total value of transactions using ICBC credit cards rose more than RMB 330 billion, or 50%, from a year earlier to nearly RMB 980 billion. The credit card loan outstanding of ICBC surged around 94% from the beginning of 2011 to RMB 170 billion at the end of the year. ICBC is providing more comprehensive financial services for cardholders, and playing an active role to the consumer growth and economic restructuring.

Industry insiders commented that the popularity of payment using bank card not only benefits in saving the transaction cost of payment system, but creates a better payment environment for cardholders. The fast and convenient payment by bank card brings a total different experience to the consumers when compared to payment in cash. Use of credit card to pay can encourage consumers to make quick decision to buy, and more likely to buy. This is very evident in stimulating consumer spending. Credit card facilitates spending since it allows credit, cardholders tend to actually spend if given an opportunity, either ad-hoc or potential, driving the consumer growth in the end.

To a commercial bank, the prevalence of bank cards, the increasing acceptance of bank cards and improvement in service level are critical to the growth of cardholder expenditure. ICBC is a case in point. Over the last few years ICBC has installed a great number of bank card devices, to a total of 50,000 ATM and 600,000 POS at present. The Bank also spent efforts to upgrade the service network and availability of bank card devices. In 2011, over 5 billion transactions went through ATMs involving an amount of more than RMB 4.8 trillion. ICBC also focused on signing up merchants, to 590,000 merchants accepting ICBC bank cards as of today.

Commercial banks in China also step up their product innovation to launch new bank cards with more functions, more personalized design for everybody to use for retail spending. Take ICBC as an example, the Bank launched Easy Time Credit Card in 2011 to better serve the salaried customers. Since the benchmark interest rate of personal consumer loan of the same term is used as reference, the fee rate of installment payment by Easy Time Credit Card is lower than that of current credit cards available in the market. As a result, young cardholders and low-income cardholders are more willing to use Easy Time Credit Card. Easy Time credit cards allow cardholders to make automatic repayment through the salary A/C opened in ICBC within the installment payment period set by themselves.

Salariat with a moderate but stable salary, good creditability can use Easy Time credit cards for their immediate retail spending whenever. Leveraging its vast database and strong information technology, ICBC grants credit in advance, on a certain percentage of actual income, to customers who have salary account opened in ICBC. Customers just use Easy Time credit cards to pay at merchants, get the consumer loan and choose the installment periods on the site, this eliminates the procedures for customers to go to the bank and apply for the personal consumer loan. Today, ICBC has 90 million personal customers with salary account opened in ICBC, as related by an executive with the Bank. The prevalence of Easy Time credit cards drives more customers to ICBC merchants, and also creates a potential buying power of hundreds of billions yuan from residents.