Credit cards discontinued as industry faces squeeze
Cho also took to social media to make sure his friends knew that the card, which costs 300,000 won ($274) a year, would be discontinued soon.
The ROVL Card became popular because it offers one free additional airline ticket a year when purchasing a flight to Southeast Asia.
If cardholders don’t need the extra ticket, they can choose to upgrade their seat instead.
Users called it the “Bali Card,” as the popular Indonesian resort island is one of the most expensive destinations in Southeast Asia and a favorite choice for free tickets.
Despite its popularity, KB Kookmin Card will stop issuing ROVL from next month, joining a growing list of financial institutions that are reducing their credit card lineups to offset stagnant growth in membership and falling profits from commission fees.
KB will also discontinue its Mir Card, which comes with a 150,000 won gift card for Lotte Department Store.
“The ROVL Card is an old product and a new release called BeV V will replace it,” a source at KB Kookmin Card said. “The two cards charge the same annual fees and share similar benefits.”
But the new card doesn’t provide the free airline ticket, prompting a flurry of last-minute applications for the ROVL Card.
KB said that it will receive new members until Dec. 22.
In a similar vein, NH Nonghyup Card will terminate a card that offered savings at gas stations under its Chaeum brand. It offered an 80 won per liter discount at gas stations if more than 200,000 won was spent on the card the previous month. Given that many cards set the ceiling at 300,000 won, the saving was considered generous.
“We will launch a new card that focuses on the gas station benefit next year, so we are streamlining the card products,” a source at NH Nonghyup Card said.
NH Nonghyup Card will receive new members until Dec. 11 online and Dec. 15 in-store.
Hyundai Card will close an exclusive bar in Gangnam, southern Seoul that catered to the holders of its House of the Purple card. The exclusive bar, located near Dosan Park in Sinsa-dong, was only accessible to holders of the card.
As well as the bar, Hyundai Card will also discontinue another card in partnership with Korea Post. Applications for the card, which offers a 10 percent discount on delivery fees at Korea Post, will be open until Dec. 15.
Industry watchers say that companies have no choice but to reduce benefits because of an anticipated decline in profits due to the government’s push to lower commission fees on debit and credit cards.
“While the interest rates will likely go up, the government pushes them to lower commission fees,” said a source in the lending industry.
BY HAN AE-RAN, PARK EUN-JEE [firstname.lastname@example.org]