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Propelling banks' credit card push

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Millennial-minded consumers making their presence felt

A lot has been said and discussed about millennials and their habits and preferences, and brands are constantly strategising how they can better reach and engage these digital-first consumers.

With millennials making up 22 per cent of Singapore's resident population, it is no surprise that businesses are finding themselves under pressure to rethink everything, from the way their products and services are marketed to how talent can be recruited and retained.

But businesses do themselves injustice if they limit their attention to this demographic - it is not just millennials who crave meaningful experiences, are comfortable with smartphones and love online shopping.

These lifestyle preferences are now embraced by most, if not all, consumers across all demographics.

In the personal finance category, these trends are already playing out beyond the millennial segment.

Our recent survey on credit card preferences, which targeted Singaporeans aged between 21 and 39, revealed patterns that can be applied to any next-generation or millennial-minded consumer.

This is important because the findings have implications for banks, which will need to do things differently to effectively promote their credit card offering to today's consumers.

Our research showed that more people (5 per cent increase) did research online before getting a credit card last year compared to 2015. We can expect to see an upward trend as mobile phone adoption rates continue to climb.

The survey also revealed a rise in online credit card applications, with 52 per cent of respondents opting for this method over roadshows (26 per cent).

To that end, credit card comparison sites have been rated as increasingly influential in helping consumers make decisions. But the roadshow model may not become obsolete any time soon, because Singapore consumers are mostly omni-channel buyers.

As costs of retail space and labour continue to increase, banks will be pressured to explore more use of digital channels other than their own so as to connect with consumers through every conceivable channel.

Millennials have been using their credit cards most frequently for online shopping and dining (24 per cent), as compared to paying for petrol and bills (5 per cent and 3 per cent respectively).

It is not surprising then, to see the rise of reward programmes such as LiveUp.

Because consumers naturally gravitate towards deals, it is a question of when - not if - before banks team up with a wide suite of e-commerce brands to offer users rebates and promotions.

Meanwhile, in the realm of travel, cashback benefits were rated as more preferable to air miles in our survey.

Although travel expenses made up the highest expenditures on their credit cards, 71 per cent of the respondents preferred cashback benefits, making it the most preferred credit card benefit category. Air miles were significantly less popular, at only 20 per cent.

Primarily, the insight behind this trend points to the level of ease in which a customer can unlock a reward.

Redeeming air miles typically involves a lengthier administrative process, but cashback is comparatively hassle-free. If the barriers to enjoying rewards are kept as low as possible, and registration is fast and painless, then consumers will have a valuable experience.


Brands have to be accessible and optimised on mobile if they want to engage with their customers - this is no longer a nice-to-have feature but a baseline expectation from today's consumers.

Our survey showed that most millennials in Singapore own an average of four credit cards each. It can certainly be confusing to keep track of the different benefits and features.

In fact, 45 per cent of those surveyed would prefer an app that can aggregate the benefits, merchant-specific deals and promotions of each credit card to help them with this problem.

It is encouraging to see that most banks already have their own mobile apps to facilitate mobile banking. But it would be a misstep if banks do not extend the same ease of mobile access to their credit card reward programmes.

There is a loyalty programme war, and banks need to question if their credit card reward strategy is just humdrum or truly connecting with customers in ways that pay off for both sides.

Ultimately, in this day and age where Singapore consumers are spoilt for choice, we believe users are going to focus on credit cards that offer a painless redemption experience and connect them to brands they truly need and like.

The writer is chief executive officer of This article appeared in The Business Times yesterday.