Rather than joining the costly fight for individual cardholders, Hana Card is focusing on payment-driven growth.
Under CEO Sung Young-soo, the company is using Hana Financial Group’s banking channels and corporate network to expand efficiently.
Sung Young-soo, CEO of Hana Card.
[Insight Korea = Son Kyu-mi]
As Korea’s credit card industry faces profitability pressure from lower merchant fees, higher funding costs and tighter card loan regulations, Hana Card is putting forward two key pillars: Travelog and corporate cards.
Rather than jumping into a costly battle in the personal card market, the company is seeking to grow payment-related revenue by expanding these two areas. Under CEO Sung Young-soo, Hana Card is accelerating a two-track strategy centered on Travelog and corporate cards.
According to the card industry on the 20th, Hana Card posted net profit of 57.5 billion won in the first quarter this year, up 5.3 percent from a year earlier. Compared with the previous quarter’s 47.7 billion won, net profit rose 20.5 percent.
Total card usage in the first quarter reached 24.5929 trillion won, up 11.6 percent year over year. All categories, including lump-sum payments, installments and long- and short-term card loans, grew. Hana Card cited the expansion of payment-related revenue centered on corporate cards and Travelog as the key driver of its earnings improvement. It also expanded its market influence in global businesses such as overseas card acquiring.
Locking in Customers With Travelog and Raising Profitability With Corporate Cards
Hana Card’s recent performance shows a change not just in scale, but in the way it grows. While traditional competition among card companies has centered on discounts, points and marketing aimed at individual customers, Hana Card is focusing on cost efficiency by using Hana Financial Group’s strengths in banking channels, corporate finance networks and overseas payment data.
The company is shifting away from costly marketing to attract individual cardholders and instead strengthening its core payment business through Hana Financial Group’s infrastructure, with a focus on qualitative growth and profitability.
Since Sung took office, corporate sales and Travelog have emerged as core strategies. Travelog is Hana Card’s main growth engine. It is a signature product that helped the company become a leading player in the overseas payment market, surpassing 10 million subscribers by the end of last year. Recently, the designation period for its innovative financial service, “foreign currency prepaid electronic payment instrument,” or foreign currency Hana Money, was extended to April 2028.
Travelog has moved beyond being a simple overseas payment card and now functions as a platform for attracting Hana Card’s individual customers. As overseas travel demand recovers, Hana Card is seeking to lock in customers by capturing the entire travel experience rather than simply competing on card benefits.
One example is its recently strengthened “Travel Log” service. Based on overseas payment data, the service displays merchant categories and location information on a map and allows users to check their spending flow and fee savings. In effect, it turns card payment data into a travel record and management service.
Corporate cards are drawing attention from card companies as a new source of revenue because they have higher payment amounts per transaction than personal cards and relatively lower default risk. In the first quarter this year, corporate card usage by Korea’s eight standalone card companies reached 33.6047 trillion won, up 6.85 percent from a year earlier. Bank-affiliated card companies account for about 70 percent of the corporate card market by usage volume.
As of the end of January this year, Hana Card’s corporate card usage stood at 1.9404 trillion won. That was up 20.86 percent from a year earlier, the largest increase among all card companies. Its market share also rose from 15.34 percent in January last year to 16.95 percent in January this year, lifting Hana Card to second place in the industry.
Sung emphasized strengthening corporate cards immediately after taking office. He previously served as head of Hana Bank’s Yeongup 1 Department, head of the Gyeonggi sales division and head of the corporate group, building extensive field experience and networks in corporate finance. That background is helping Hana Card expand its corporate customer base.
The core of Hana Card’s corporate card strategy is cooperation with Hana Bank. The strategy is to attach corporate loans and corporate card packages to companies that already bank with Hana, and to shift general expense-related card spending to Hana Card. More broadly, it is a strategy that fully uses the corporate customer influence of the entire financial holding group.
Expanding an Efficient Customer Base, but Asset Quality and Fee Income Remain Key
Concerns over asset quality are easing. Hana Card’s delinquency rate rose into the 2 percent range last year, but after efforts to improve risk management, it fell to 1.81 percent in the first quarter this year. Since the strategy of expanding corporate cards and Travelog ultimately depends on sound asset quality, delinquency management is likely to become increasingly important.
Still, the decline in total operating revenue and fee income, which fell 3.6 percent and 19.4 percent, respectively, remains a concern. The improvement in first-quarter net profit was also partly affected by one-off gains. Going forward, a key question will be how much Hana Card can offset declining fee income and industry uncertainty.
A company official said, “In an environment of major internal and external change, we will establish a sustainable growth base through solid management.”
“We will continue to grow payment-related revenue by expanding customers through growth in corporate and global businesses, as well as through the Nara Sarang Card,” the official said.
- This article was translated by ChatGPT. (이 기사는 챗GPT가 번역했습니다.)
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