In recent years, the credit card business in China has been facing challenges due to decreasing demand caused by the economic downturn. To meet performance targets, some bank employees have resorted to subsidizing credit card promotions out of their own pockets. It has become common practice for bank employees to offer gifts when signing up for a credit card.
According to a report from Tencent News on July 1st, a manager named Zhang Yi (alias) from a commercial bank in China revealed to the media that promoting credit cards has become increasingly difficult. Zhang Yi said, “It’s tough to attract new cardholders these days. If we don’t offer gifts to customers, there is almost no demand for new cards, so we end up spending our own money on promotions.”
Despite the challenges in promoting credit cards, meeting performance targets has become an annual priority for bank employees. Zhang Yi mentioned, “Our targets increase every year, and failing to meet them results in a deduction from our performance bonus.” A bank employee named Cao from Beijing shared that the workload for credit card applications at the frontline staff of banks remains constant. Failing to meet the targets leads to reduced compensation and performance deductions, which compels employees to come up with promotional strategies.
Employees at a bank in Jiangsu also noted that the credit card issuance targets mandated by the bank increase annually. To avoid financial penalties, frontline staff members have resorted to purchasing gifts such as bicycles to attract new cardholders and improve their performance ratings. However, the upcoming year’s targets are expected to be even higher.
In order to fulfill the credit card issuance targets, bank employees in various regions, including Beijing, have initiated promotional activities. Recently, a month-long “Apply for a Card and Get a Free Bicycle” campaign has been launched in different districts. Participants are required to hold two credit cards from separate banks to receive a free bicycle. Additionally, cardholders must maintain the card for at least three months and conduct multiple transactions before they can cancel the card.
Zhang Yi emphasized that the practice of offering gifts as part of the credit card application process has become normalized in banks. He stated, “It’s common for banks to offer gifts to attract customers. Otherwise, who would bother applying for a credit card?”
The decline in demand for credit cards while banks continue to raise performance targets for their employees has puzzled industry insiders. Some suggest that banks have not adapted their strategies effectively. Banks rely on attracting new customers to maintain market share without allocating additional marketing funds, shifting the burden of costs onto their frontline employees. Additionally, the oversaturation of existing customers with the banks’ credit cards encourages staff to seek out new customers for potential growth.
However, industry professionals warn that using incentives to boost credit card applications may lead to artificially inflated numbers and increase the risks associated with credit card operations. As the volume of credit card issuances declines, banks are also grappling with the repercussions of excessive market expansion. Many individuals who were not originally inclined to use credit cards were lured by introductory rewards, leading to an over-reliance on credit cards.
The increasing number of credit card defaults in China is reflected in the data from the People’s Bank of China, which shows that the total amount of overdue credit card loans has risen from 98.135 billion yuan at the end of 2023 to 123.964 billion yuan at the end of 2024.
Concerns raised by citizens like “Easy Summer” reflect a growing trend of more individuals defaulting on credit card payments. People are becoming more cautious with their spending, attributing it to tighter financial constraints and unstable incomes in the current economic environment.