RIZAL COMMERCIAL Banking Corp. (RCBC) expects a rebound in the credit card industry this year as the economy gradually recovers.

RCBC President and Chief Executive Officer (CEO) Eugene S. Acevedo said the industry’s credit card business experienced a slump in 2020 as the pandemic altered consumers’ lifestyle.

“But steadily, RCBC and the rest of the country’s banking industry are changing the pace this year. We are now seeing a quick recovery of the market in 2021,” Mr. Acevedo said at the launch of the RCBC Bankard’s new partnership with MasterCard, Inc. and Zalora Philippines.

“The continued revival of economic conditions, along with the ongoing vaccine distribution, can only positively impact the Philippines’ credit card market,” he added.

The three firms partnered to launch the Zalora Credit Card, which is particularly targeted for online shoppers interested in fashion and lifestyle benefits and freebies.

Mastercard Philippines Country Manager Simon Calasanz said the credit card is equipped with security features, including secure codes and authenticators, to help protect consumers in their online transactions.    

“The new Zalora co-brand card gives users a physical first experience, meaning a virtual card is issued as soon as your application is approved. So you can start using it while waiting for your physical card in the mail,” Mr. Calasanz said.

The credit card is also a move towards sustainability as it is made using eco-friendly materials, RCBC Bankard Services Corp. President and CEO Arniel Vincent B. Ong said.

“It’s not made out of recycled material but it’s non-edible corn, which makes it a sustainable plastic substitute,” Mr. Ong said.

The maximum spending limit for their credit cards is “normally capped at P5 million”, although this could be adjusted higher depending on a customer’s capacity, he said.

“You can imagine how a lot of the affluent customers actually use up a lot of these high limits. There are really customers with very, very high usage,” he added.

Mr. Ong said consumer confidence has improved as the economy gradually reopens, as seen in the rise in credit card transactions.

“When we take a look at transaction volumes, they’re now up by about 15% for the industry. What’s probably more relevant is for RCBC, it’s up by about 25% year on year in the first nine months,” Mr. Ong said.

He also noted that their delinquency rate has generally improved as financial institutions have made arrangements with their customers on the management of their debts.

“So it will be a single-digit delinquency rate, which is similar to what RCBC is experiencing. In our case, delinquency has already peaked and we are now getting near to pre-pandemic levels,” he said.

Meanwhile, Zalora Philippines Co-founder and CEO Paulo L. Campos III said they expect “revenge shopping,” or making up for the time lost to the pandemic by spending, to fuel the rise in credit card payments.

“E-commerce in the Philippines is still going strong, and poised to grow to $15 billion in 2025, coming from $3 billion in 2019 and $4 billion in 2020,” Mr. Campos said.

RCBC Bankard and Zalora are waiving the card’s annual fee for the first year of use.

RCBC shares ended trading at P19.80 apiece on Thursday, up by 20 centavos or by 1.02%. — Luz Wendy T. Noble