The Chinese credit card industry is one of the most quickly expanding card markets across the globe and has shown impressive growth rates during the last few years, according to a new study.
RNCOS Industry Research reported that the majority of the transactions done by credit cards form only a small portion of the retail transactions in the country. A rapidly surging middle class population, growing consumer spending and a huge untapped rural area, however, lead RNCOS to conclude that the total number of credit cards in China will grow at a compound annual growth rate of around 31 percent in the next three years.
RNCOS said that technology will help increase the penetration level of bank cards as well as bring large rural populations within the reach of banking products and services, reducing the gap between the urban and rural banking industry.
The report compliments a prediction made by Mastercard, Inc., in a Wall Street Journal article from September that expected China to overtake the U.S. as the world’s largest credit-card market by number of cards by 2020 because of the country’s fast urbanization.
According to the Wall Street Journal, global credit-card companies are frustrated with their limited access to the Chinese market, since the country’s only national electronic payment network has a monopoly on processing card payments.