‘More beneficial interest rate than K Bank’…Commercial banks to compete with K Bank
Kang Eun Seong | esther@ | 2017-04-12 09:39:49
Internet bank, K Bank broke the 100,000 subscriber record in fourth days of service start and the crisis of the existing financial companies such as banks and credit card companies is growing. Some banks and credit card companies are quickly launching special products and launching counterclaim strategies.
According to the financial sector on April 11, the emergence of K Bank has shown that existing financial companies have jumped into a full-scale interest rate competition. The key point of the K Bank is that it is not only easy and convenient to use 24 hours a day, 365 days a year using the Pin Tech platform, but also because interest rates and commissions are better than those of existing financial companies. A senior expert of a commercial bank said, ‘There will be few executives who predicted that K Bank launch would be successful. K Bank has a limited market and the mainstream banking market. I think there will be limitations, but the initial subscriber trend does not seem as usual.’
He said, ‘Due to the nature of domestic financial consumers, the `leaning phenomenon` is very strong. I assume that if commercial companies are not able to propose new strategic products, they may fall behind in interest rate competition and digital competition.’
In fact, Woori Bank, which is also the main shareholder of K Bank, launched ‘Wibi Super Main Package II’, a savings product offering up to 2.2% interest rate through mobile bank `Wibi`. In the same product, the maximum interest rate is 2.0% annually for term deposits. At the end of March, the bank had launched a product offering up to 2.1% interest rate on regular deposit customers through `The Dream Event Season 2`.
IBK Industrial Bank also recently launched a special deposit, which offers a 2% interest rate as a special product to commemorate the women`s volleyball team Altos won the league championship. Meanwhile, NH Nonghyup Bank provides up to 2.24% interest rate including 0.8% point preferential rate through `monthly welfare payment for company workers`.
Meanwhile, commercial banks` interest rates on regular accounts have been 1.2% ~ 1.5% a year. The 2% level of deposits is all that has been on the market for a limited period of time when market interest rates rose sharply earlier this year.
However, K bank`s regular deposit account, which was launched with the launch of the service on April 3, offered the highest interest rate at 2.0%, and commercial banks also released related products in succession.
Card companies are also in panic. Card companies began to set up countermeasures as K-bank launched a check card product that did not encourage its subscribers because it had less commission income than credit cards.
The NH Nonghyup Card is scheduled to launch the ‘NH20 Hae bom’ Check Card in May. This product, like K-bank, will return the mobile service charges according to the usage result. In the case of using more than KRW 200,000 a month, users will receive a mobile service fee of KRW 2,500 in cash back. The conditions are better than K Bank.
Song Soo-young, a professor of business administration at the Chung-Ang University, stated, ‘Domestic banknotes seemed to be in full swing until the end of March, when the market interest rate rose sharply from the US base rate increase. But when K Bank launched the banking system, financial consumers were moving to a more favorable interest rate, so the banknotes are also entering into interest rate competition mainly on special products.’
By Kang Eun Seong esther@
[ copyright ⓒ The Digitaltimes ]
According to the financial sector on April 11, the emergence of K Bank has shown that existing financial companies have jumped into a full-scale interest rate competition. The key point of the K Bank is that it is not only easy and convenient to use 24 hours a day, 365 days a year using the Pin Tech platform, but also because interest rates and commissions are better than those of existing financial companies. A senior expert of a commercial bank said, ‘There will be few executives who predicted that K Bank launch would be successful. K Bank has a limited market and the mainstream banking market. I think there will be limitations, but the initial subscriber trend does not seem as usual.’
He said, ‘Due to the nature of domestic financial consumers, the `leaning phenomenon` is very strong. I assume that if commercial companies are not able to propose new strategic products, they may fall behind in interest rate competition and digital competition.’
In fact, Woori Bank, which is also the main shareholder of K Bank, launched ‘Wibi Super Main Package II’, a savings product offering up to 2.2% interest rate through mobile bank `Wibi`. In the same product, the maximum interest rate is 2.0% annually for term deposits. At the end of March, the bank had launched a product offering up to 2.1% interest rate on regular deposit customers through `The Dream Event Season 2`.
IBK Industrial Bank also recently launched a special deposit, which offers a 2% interest rate as a special product to commemorate the women`s volleyball team Altos won the league championship. Meanwhile, NH Nonghyup Bank provides up to 2.24% interest rate including 0.8% point preferential rate through `monthly welfare payment for company workers`.
Meanwhile, commercial banks` interest rates on regular accounts have been 1.2% ~ 1.5% a year. The 2% level of deposits is all that has been on the market for a limited period of time when market interest rates rose sharply earlier this year.
However, K bank`s regular deposit account, which was launched with the launch of the service on April 3, offered the highest interest rate at 2.0%, and commercial banks also released related products in succession.
Card companies are also in panic. Card companies began to set up countermeasures as K-bank launched a check card product that did not encourage its subscribers because it had less commission income than credit cards.
The NH Nonghyup Card is scheduled to launch the ‘NH20 Hae bom’ Check Card in May. This product, like K-bank, will return the mobile service charges according to the usage result. In the case of using more than KRW 200,000 a month, users will receive a mobile service fee of KRW 2,500 in cash back. The conditions are better than K Bank.
Song Soo-young, a professor of business administration at the Chung-Ang University, stated, ‘Domestic banknotes seemed to be in full swing until the end of March, when the market interest rate rose sharply from the US base rate increase. But when K Bank launched the banking system, financial consumers were moving to a more favorable interest rate, so the banknotes are also entering into interest rate competition mainly on special products.’
By Kang Eun Seong esther@