90% Increase in 2 Years... Rapid Growth of Savings Bank Check Cards

Savings Bank Card Sales Reach 129.9 Billion Won, Up 28% Year-on-Year
Active Members and Cards Also Increased Over 90% in Two Years
Marketing and Parking Accounts Boost Awareness, App Renewal Shows Strong Effects

[Asia Economy Reporter Song Seung-seop] The check card business in the savings bank industry is experiencing rapid growth. Analysts attribute this to increased brand awareness through various marketing efforts, including parking accounts, as well as the provision of non-face-to-face subscription services via mobile applications (apps).

According to the Korea Federation of Savings Banks on the 2nd, the sales of eight types of cards handled by the federation last year amounted to 129.9 billion KRW, a 28% (37.6 billion KRW) increase compared to the previous year. Compared to two years ago, when sales were around 89.3 billion KRW, this represents an increase of about 45%.

The number of active members who regularly use the cards is also rapidly expanding. The total reached 273,162, showing a 93% (141,503 people) increase over two years. Compared to the previous year, this is a 41% increase. The number of valid cards, whose validity period has not expired, also rose to 275,358, increasing annually by 36% and 40%, respectively.

Since 2008, the federation has launched card products in partnership with BC Card as part of business diversification. At that time, many small savings banks lacked the capacity to issue check cards, so the federation began joint operations with the industry. Although various cashback discounts and preferential interest rates were offered, performance was minimal due to low brand awareness, according to insiders.

Marketing, Parking Accounts, and App Revamp Behind Card Performance Improvement

Recent improvements in card business indicators are analyzed to be due to the industry's active marketing strategies to raise brand awareness. Large savings banks actively aired advertisements after TV advertising restrictions, which previously allowed ads only during late-night hours, were lifted in May last year. Pepper Savings Bank launched its first-ever TV commercial since its founding, and the federation also participated. OK Savings Bank recorded high views with YouTube content, and the entire industry focused on enhancing brand value.

Additionally, the low-interest-rate environment and the stock investment boom increased interest in parking accounts, rapidly expanding the industry's deposit and savings scale. According to the Bank of Korea, the deposit amount of savings banks, which was 59.8102 trillion KRW in 2018, grew to 79.1764 trillion KRW in two years. In response, the federation designed the ‘SB Wise Check Card’ to function as a deposit and withdrawal account that can use Pepper Savings Bank’s parking account.

The large-scale improvements in mobile financial platforms by savings banks also appear to have had an impact. As demand for non-face-to-face and digital finance continues to grow, the industry built systems allowing customers to subscribe to card products non-face-to-face through user-friendly apps. Leading the industry, SBI Savings Bank, along with OK, Welcome, JT, Sangsangin, Accuon, and KB Savings Banks, renewed their apps. The federation also launched the mobile app SB Toktok Plus at the end of 2019, enabling non-face-to-face subscription and use of seven out of eight check cards.