Despite the current credit crunch, the card industry is here to stay
Plastic money or credit cards are the most popular method of payment in most industrialised countries. They are increasingly becoming an essential part of people's lives in developing countries around the world.
The credit card industry is currently experiencing difficulties, along with the rest of the financial products industry, as a consequence of the global financial troubles.
But industry players in the UAE are optimistic and confident of continued, albeit slow, growth in the near future.
"The current economic crunch has affected the credit cards industry as well," says Farman Ali, Senior Manager, National Bank of Abu Dhabi (NBAD) Cards. "However with more prudent selection criteria those with a better service offering will continue to grow their business. We believe the market will improve with time.
"NBAD cards have all the standard features along with many free features such as SMS alerts of all transactions, full security for internet shopping, roadside assistance and purchase protection.
"Our current focus is on consolidation rather than expansion. We will be focusing on penetration of banking customers as well as commercial space. Further we have plans to be more aggressive on prepaid card sectors," says Ali.
Chip technology
Almost all major banks in the UAE have linked their credit cards to Visa and/or MasterCard, much to the convenience of their clients here.
Both offer credit cards in various options of platinum, gold, classic, standard, and provide secure, convenient and reliable payment options from locations all over the world.
Abu Dhabi Commercial Bank (ADCB) offers both MasterCard and Visa in platinum, gold and classic as well as a flash card. The new 'chip' technology in the ADCB credit card offers more security than cards with only a magnetic stripe and also offers chip rewards.
ADCB's Exclusive Traveller card brings users a range of travel deals that offer great savings when payment is made with ADCB credit or smart debit cards. The bank has also tied up with Lulu Hypermarket chain and has come up with the ADCB LuLu credit card, which allows the cardholders to earn LuluPoints and redeem rewards and privileges.
They also provide everyday savings while shopping at Lulu outlets. TouchPoints, the biggest rewards programme in the UAE from ADCB, are points that you earn when you use ADCB products and services.
First Gulf Bank's platinum, ladies, gold and standard credit cards linked to Visa and MasterCard offer a host of privileges and benefits.
Cardholders can pay for almost everything from grocery bills to international travel on their First Gulf Bank credit card, and get rewarded through First Rewards. The ladies card is a specially tailored credit card that gives women a range of value-added benefits, discounts and offers across a selection of stores.
Selektpoints offers many variations on loyalty, payments and security. "We believe flexibility to our partners is essential to offering a platform, solution or product that is tailored specifically to their requirement. Ensuring no capital investment for the partner and offering a comprehensive suite of solutions is paramount," says Neil Smith, Vice President — Global Partnerships at Selektpoints.
Some main features of Selektpoints include 'Earn and Burn' whereby both consumers and B2B businesses can acquire loyalty points and/or instant cash discount at the time of purchase. Aspiration rewards allow consumers to earn points in due course of time from varying participating partners for their own desires.
Smart Card
Smart Card technology brings all of the above to a 'real time' scenario and specifically for financial institutions, which allows for a solid business case to migrate to advanced chip-technology.
Finally Post Processing Engine (PPE) enables partners to use existing platforms and technologies for pushing all rewards and payments online to the back end. "We also have the capability to capture Stock Keeping Unit (SKU) level information at the time of transaction better enabling specific offers that are relevant to the consumer," says Smith. "We believe we have developed a product that will suit the needs of many companies in the future and will help develop their businesses following this market slow-down."
During the current difficult situation, Selektpoints is building on its experience of more than 50 years within the loyalty, payments and security business by offering advisory work on top of its core products. Smith says, "It is certainly a challenging time for everyone now and in moving ahead, from banks, loyalty firms, retail and the ultimately the end consumer.
However, due to prioritisation, generally loyalty programmes may slip down the list, but it is important to understand that loyalty brings significant benefits to the customers in times of need and can allow entities to refocus marketing budgets and maximise similar software tools that Selektpoints can offer as well as carrying out 1:1 marketing," says Smith.
Islamic Credit Cards
What is the difference?
The Islamic credit card works in a similar way to conventional credit cards, but is Shariah compliant (no interest, no hidden cost) and based on Ujrah or service charge. The card charges an annual fee, payable on a monthly basis.
Cardholders can use the card for all purchases except to conduct prohibited transactions in places such as casinos and hotel bars.
The Visa covered card from Abu Dhabi Islamic bank offers flexible parameters and many value-added features, such as one per cent cash back on all purchases, 100 per cent cash withdrawal and grace period of up to 55 days.
They are available in three categories classic, gold and platinum, and are approved by Fatwa and Shariah Supervisory Board of the Bank.
Al Hilal Bank Classic and Gold Visa Credit Cards combine ethical values with clear, simple benefits, which mean holders are honouring Islamic morals and traditions.
Standard Chartered's first global Islamic credit card — the Saadiq Visa Gold Credit Card, which means 'truthful' in Arabic, is based on international banking standards, and tailored to meet customers' needs for an interest-free credit card.
The card comprises a card and service account, and operates on a fixed-fee structure based on the 'Ujrah' concept. This feature provides customers with the flexibility of paying a fixed monthly maintenance fee and does not depend on the outstanding balance or duration of the balance in the service account.
— L.K.
