Citibank Credit Card

 Citibank Visa or mastercard Essay


REV: OCTOBER 2, 2002


Citibank: Launching the Credit Card in Asia Pacific (A)

On a rainy evening in 1989, Rana Talwar, head of Citibank's Asia Pacific Customer Bank, reflected upon the 11 years that had gone by because the Consumer Traditional bank had founded its client business in Asia. The branch bank business operations in 15 countries throughout Asia Pacific and the Middle East expected Citibank as being a prestigious, consumer-oriented international traditional bank and as the undisputed leader in most marketplaces. With profits of $69. 7 mil in 1988, and a goal of $100 million in 1990, Talwar considered as the launch of the new product (credit cards) as a way of growing future earnings. (See Show 1 to get 1988 overall performance. ) Credit cards could prove to be an effective way to conquer distribution constraints imposed upon foreign banking companies in the Asia-Pacific region: initial, by obtaining card associates, by concentrating on customers outdoors its branch business and, then, by actively cross-selling other Citibank products and services to these customers. In past times, the credit-based card idea got met with skepticism from Citibank's New York hq as well as it is country managers. Many in New York regarded it a risky investment. Senior credit managers questioned the perception of giving cards in markets with annual every capita salary of $350 and also in markets with little credit experience and hardly any facilities. The Citibank management known that the economies of most Asia-Pacific countries had been relatively underdeveloped compared with america and Europe; consumers' thinking and credit-based card usage habits differed nation by country. Through this context, a lot of country managers were not sure whether the achievement of Citibank's U. T. card organization could be forecasted onto Asia-Pacific. Further, that they wondered if Citibank could adopt a mass-market setting to acquire enough credit card buyers and still maintain its up-market positioning with the current upscale branch banking consumers. A premium-priced card item would not sell in the marketplace within a large way, it was contended. Moreover, region managers are not comfortable with a credit merchandise such as credit cards and would not want to take the large losses of a card business, in the initial years, that their projections seemed to indicate. Weak regional infrastructure, limited distribution capacities, and the experience with loss-making private credit card businesses that some of the countries got, served to underline disputes against credit cards launch. Pei Chia, who had been appointed at the end of 1987 to move Citibank's Foreign Consumer businesses, had knowledge managing Citibank's huge U. S. credit card businesses and was favorably disposed toward international growth. Confident of support via his supervisor if a viable proposition could be structured, Talwar pondered the good qualities and negatives of a credit-based card product. In the event that he chose to push to get the product, he would need to articulate a viable business strategy.



Mentor V. Kasturi Rangan well prepared this case with all the research assistance from Marie Bell and Melanie Alper because the basis intended for class discussion rather than to demonstrate either successful of ineffective handling of the administrative condition. Copyright © 2002 Chief executive and Guys of Harvard College. To order clones or request permission to reproduce materials, call 1-800-545-7685, write Harvard Business University Publishing, Boston, MA 02163, or head to No part of this publication may be reproduced, trapped in a collection system, used in a spreadsheet, or sent in any form or simply by any means—electronic, mechanical, copying, recording, or otherwise—without the permission of Harvard Business School.



Citibank: Launching the Credit Card in Asia Pacific cycles (A)


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