Now incorporating a mobile payment platform, the application scenarios of CMB’s electronic payment system have extended from online shopping to other fields.
According to statistics, the e-transactions made by CMB customers totals 45 million per month at a value of CNY 20 billion, which is still rising. In the first eight months of 2012, over 10 million CMB’s customers made e-payments.
With the development of ICT and the Internet, e-commerce has become an important part of the strategic development of China in the 12th Five-Year Plan period.
At the same time, under the influence of the accelerated interest marketization, the changes in profit modes have become an urgent issue for banks. The 12th Five-Year Plan for the Development and Reform of the Financial Industry recently published by the PboC emphasizes the diversification of the banking service.
In response to the policy of the PBoC and in line with CMBs mission, CMB leads the e-commerce market. By developing innovative mobile payment technologies, continuously optimizing services and setting up industry benchmarks in a number of areas, CMB facilitates public consumption in various ways, and drives the growth of e-commerce in China.
Today’s CMB e-payment application scenarios include business trips, ticketing for performances, leisure and entertainment, education and training, and utility bill payments. The payment mode has evolved from online to mobile, keeping pace with technological development.
New Content in E-Commerce Drives Service Change
The fast growth of Internet banking is causing dramatic changes in the business and service modes of commercial banks, forcing them to strategically adapt their internal management and operating mechanisms. At the same time, changes in service modes makes banking easier for customers.
CMB is committed to developing e-commerce. In September 2010, it launched its online shopping center credit card club. The friendly user interfaces, superior browsing experience and effective campaigns have made the e-payment process an enjoyable experience.
In creating its online shopping mall, CMB has striven to perfect each step and aspect, especially product quality. It ensures that only products with proven quality are offered at competitive prices, and believes that the mall will be recognized by consumers as an exemplary and secure shopping platform.
Since its launch, membership to the CMB credit card club has been climbing each year. In the first half of 2012, sales totaled CNY 378 million, up 44.8% year on year.
Apart from its own credit card club, CMB also works with well-known stores and third party payment companies. Customers are able to use their CMB cards to shop in tens of thousands of online stores for almost any product without stepping out of their house.
To meet the rapid rise in customers taking business trips, Easy Trip serves as a travel booking platform exclusively for CMB credit card and All-in-One card holders. Easy Trip provides CMB card holders with ticketing and flight information services covering 22 domestic air lines and over 7,000 domestic flights, as well as a hotel room reservation service covering over 13,000 quality hotels in nearly 600 Chinese cities.
Based on its optimized travel service, CMB offers a compensation service for flight delays, re-defining the criteria from the perspective of a financial company. The compensation service requires no application from customers, and CMB will compensate CNY 200 for delays over 2 hours, narrowing the previous 4-hour limit and removing the rule that bad weather invalidates a compensation claim.
Mobile Payments in Your Hand
With the rapid growth of mobile Internet, smart phones have evolved into network terminals that also provide a reliable payment tool. During the first quarter of 2012, Chinese mobile terminal users increased by 39 million, the largest increment in the world. By the second quarter of 2012, smart phone users in China totaled 290 million, up 15.1% from the last quarter. As the age of mobile internet grows, financial companies are discovering a massive new market.
As a critical innovation in the retail payment system and a positive complement to traditional financial services, the mobile payments have opened up a promising market. Mobile payments can enhance financial services, drive the fast growth of e-commerce and the economy, and meet people’s diverse payment demands.
In November 2010, CMB joined hands with China Unicom to release the iPhone app “Life in Your Hand”. The CMB app is a mobile phone client that integrates online shopping and banking to provide an ultra-convenient financial platform that offers a full range of value-added services.
In 2012, mobile banking customers, transactions and payments all grew rapidly. As of June 30, 2012, CMB’s apps for iOS and Android had been downloaded 4 million times, topping rival apps in terms of reputation and appraisal. In 2012, around 7,090,300 customers subscribed for CMB mobile banking. Total transactions increased by 429% compared with 2011 to reach 3,752,800, which generated CNY 128.01 billion, up 185%. Mobile payments increased by 230% to hit 13,614,500, which generated CNY 3.646 billion, up 309.20%.
Recently, CMB joined hands with HTC to release the CMB Mobile Wallet, marking a breakthrough in near-field mobile payments. The launch of the CMB Mobile Wallet is the first of its type under the new mobile standards, and has opened up a new chapter in payment methods, creating a new age of card-free payments.
With the mobile payment function provided by CMB, customers can make payments online via their phones anywhere, anytime. With the new mobile wallet function, they are able to make payments via their phones at convenience stores, coffee shops and cinemas without using cash or cards.
Finance + Social Network for New Cyber Citizens
As social networks spearheaded by Facebook rise in prominence across the globe, people’s lives are changing as well. For the credit card sector, this means both an opportunity and a challenge in terms of the traditional marketing mode. Currently, identifying ways to take the lead in this new environment while delivering consistently high quality products and services is the aim of all financial companies.
Ma Weihua, President of CMB, sees Facebook as the strongest rival to the banking industry. In his opinion, with 840 million real-name users, Facebook can identify customers with borrowing demands and, with the help of cloud computing, establish P2P-based intermediate financing platforms, which will weaken the role of banks as financing intermediaries.
As an SNS, it not only surpasses physical space and real-life communities, but also has the features of the ‘acquaintance’ society. Strangers enter into a semi-acquaintance relationship as the result of the intersection and overlapping of their social networks. The credit system in conventional society exists as an alternative in such a community, and this is the reason why community finance emerges naturally.
As a result, CMB stepped into the social network arena in 2011 when the CMB credit card center joined hands with renren.com to release co-branded credit cards that connect renren members with more than 10,000 contracted merchants. Within four months of launching the Renren Card, CMB received applications from over 100,000 people.
At the same time, the CMB credit card center partnered with Tencent to issue co-branded cards to gain direct access to the biggest user groups in China. With the popularity of online games, CMB released three credit cards relating to World of Warcraft, Perfect Games, and DNF based on the accurate analysis of game players’ interests and demands. Moreover, the first credit card aimed at microbloggers was launched a few days ago, which aims to integrate the social behaviors and consumption habits of users and promote the “microblogging card”.
Over the last few years, through a range of widespread, innovative and notable campaigns, CMB has created a personalized and richer social and financial life for its card holders, and now dominates the world of social networking.
Several years ago, it was regard as a joke that conventional commercial banks could be challenged by the Internet. Now, it is putting immense pressure on bankers. People in the banking sector clearly sense the challenge of “disintermediation” that faces conventional commercial banks due to the Internet.
Through its vision, “we are here just for you”, CMB again leads the trend of technology-driven finance as part of its second reform strategy.