South Korea-based credit card company Shinhan Card, together with KakaoBank, has signed a business agreement to develop and market a private-label credit card (PLCC).
In a bid to expand its operations and capabilities, Shinhan Card partnered with KakaoBank, a domestic internet bank, to launch the KakaoBank PLCC for customers leveraging the latter’s services. As a PLCC requires a card company to sign a contract with a specific brand to offer differentiated benefits to customers, the KakaoBank PLCC is set to utilise Shinhan Card’s big data infrastructure to analyse consumption and lifestyle patterns. Afterwards, these insights plan to be integrated with KakaoBank’s products, enabling it to launch a new service.
More information on the announcement
As part of their collaboration, Shinhan Card and KakaoBank intend to improve and optimise service connectivity based on digital platforms, delivering multiple services, including card performance tracking, benefit details, and additional solutions. Currently, Shinhan Card’s customer base includes nearly 32 million individuals via its integrated membership, while KakaoBank has approximately 24 million users. Despite having overlapping customers, the distinctions between the primary customer demographics of both companies highlight the possible expansion opportunities for their PLCC offering.
Furthermore, the partnership between Shinhan Card and KakaoBank is projected to accelerate the mobile transition in the card business, whilst allowing the two companies to extend their capabilities. Before the current announcement, KakaoBank bought a 10% stake in Superbank, with the move aiming to allow it to work on the development of the latter’s product and service, whilst gaining experience in the Southeast Asian market. Also, the partnership merged KakaoBank’s digital finance and platform efficiency in South Korea with Superbank’s network of partners.
The internet-only bank KakaoBank also signed in June 2023 a Memorandum of Understanding with SCBX to obtain a virtual banking licence from Thailand’s Central Bank. Through this, KakaoBank intended to obtain its banking licence to run a digital banking platform from the Central Bank of the region. By joining forces with the SCBX financial group, KakaoBank was set to focus on its overall plan for business expansion into the Southeast Asian economies and industries.
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