[Hyundai Card's Dilemma ③] At the Threshold of Sustained Growth

Amid an overall slowdown in the credit card industry, Hyundai Card has achieved external growth, but its profitability indicators are showing signs of deterioration. Some observers note that while Hyundai Card still maintains an innovative brand image, the effectiveness of its core strategies is weakening, blurring its points of differentiation. In this context, Newswatch examines whether Hyundai Card’s current strategies are being balanced effectively between profitability and growth. _Editor's note

Article series

[Hyundai Card's Dilemma ①] Carrying Apple Pay alone

[Hyundai Card's Dilemma ②] Expiring partnerships…the future of PLCC strategy

[Hyundai Card's Dilemma ③] At the threshold of sustained growth

(Continued)

Hyundai Card headquarters. Photo= Reporter Lee Sumi

| Newswatch = Reporter Lee Sumi | Hyundai Card posted solid results in the first quarter of this year, continuing improvements in both scale and profitability. However, amid a broader slowdown in the card industry, questions are emerging about whether this performance can translate into sustainable expansion. The industry is watching closely to see whether Hyundai Card can move beyond being a "well-performing card company" to building a structure capable of scaling to the next level.

According to industry sources on the 29th, Hyundai Card recorded a net profit of 64.7 billion won in Q1, up 5.4% year-on-year. During the same period, operating revenue reached 1.1815 trillion won and operating profit stood at 87.9 billion won, increasing by 22.4% and 10.2% respectively. Total transaction volume also grew by 5.2% to 48.04 trillion won, showing an overall growth trend.

Strong performance driven by product competitiveness

This performance is attributed to Hyundai Card’s strategy of strengthening product competitiveness, which has led to an expansion of its customer base. Recently, the company launched three types of "Hyundai Card Check" (points-based, cashback, and Apple Pay Rewards). By continuously introducing a variety of financial and co-branded products, the company has maintained steady customer inflows.

Growth in overseas payments has also been a key factor. Hyundai Card ranked first in overseas credit card spending for three consecutive years as of last year. Enhanced convenience in payments and upgraded services such as "Overseas Mode" and Japan-related partnerships contributed to this performance.

Balancing performance and risk management

The company has also strengthened preemptive risk management. As of Q1 this year, Hyundai Card's delinquency rate stood at 0.85%, down 0.05 percentage points from a year earlier. This indicates that the company is managing key asset quality indicators stably while improving profitability, achieving both growth and risk control simultaneously.

However, card companies have faced structural pressure on profitability in recent years. One major reason is the continued reduction in merchant fees for small businesses. Additionally, firms are finding it difficult to aggressively expand loan-based assets such as card loans and cash advances as they did in the past. In response, some major card companies are expanding overseas by establishing local subsidiaries in Southeast Asia.

Image= Gemini

Differentiation through data…"Universe" exported to Japan

Hyundai Card has taken a different approach. Instead of recruiting members overseas, it has redefined its accumulated payment data as a "technological asset." This data—capturing when, where, how, and how often customers spend—represents a unique asset built over time. Over the past decade, Hyundai Card has focused on structuring and designing this data.

The result is the "Universe" platform. Through Universe, Hyundai Card organizes payment data into a tag-based system and uses it to analyze customer consumption patterns in detail. Moving beyond simple demographic categories like age and gender, the platform segments customers based on actual spending contexts. This enables more sophisticated partner marketing and personalized benefits, turning data into practical business value.

The company also uses data to analyze trends across commercial districts and industries. Notably, Hyundai Card recorded the highest average monthly spending per user—1.245 million won—as of last year, maintaining the top position in the industry for three consecutive years. This reflects its strengths in data science and premium product competitiveness.

At a growth threshold…seeking breakthroughs through data and diversification

Despite these achievements, industry observers believe Hyundai Card faces a "threshold" in sustaining its current growth trajectory. Due to structural stagnation in the domestic card market, growth centered on existing businesses has limitations. Additionally, with ongoing fee cuts, lending regulations, and intensifying competition in payment services, the challenge of achieving both competitiveness and profitability is increasing.

In response, Hyundai Card is expanding into new businesses based on data and artificial intelligence. The company aims to strengthen its revenue base by broadening into new business areas alongside its existing operations. A Hyundai Card official stated, "We are continuously focusing on enhancing product competitiveness and risk management, and we plan to strengthen our revenue base through investment in data-related initiatives and expansion into new businesses."

Reporter Lee Sumi newswatch@newswatch.kr