theaustralian : AUSTRALIA'S fiercely competitive $30 billion credit-card market has claimed its first casualty, with the pioneering Bankcard throwing in the towel yesterday after more than 30 years. Bankcard, which introduced middle Australia to the cashless society with the first credit card, said it would "progressively withdraw" its credit cards this year. For Bankcard Association of Australia general manager Garry Moffatt, who has been part of the credit card market for more than 30 years, the past 10 of them at Bankcard, it was a "sad day".
"Bankcard changed the Australian financial services landscape forever when it launched more than 30 years ago, but an Australia-only credit card is simply not attractive in the current credit-card market," Mr Moffatt said.
At its peak, Bankcard had more than five million cards on issue. But it has struggled since the arrival of international credit card operators Visa and Mastercard in the early 80s.
Without any significant marketing spending by the banks who own Bankcard and without features such as loyalty points, the number of cards on issue has fallen to about one million and the office is now staffed only by Mr Moffatt and three other bankers on secondment.
By contrast, Visa's customer base has ballooned to 12 million and Mastercard's to six million.
Charge cards such as American Express and Diners Club were in Australia when Bankcard launched, but were still niche products for wealthy customers.
Mr Moffatt said Bankcard was now unable to match the features and benefits of internationally accepted cards. Before the arrival of Visa and Mastercard, Bankcard made an attempt to build international acceptance for the card, but negotiations failed.
The local banks joined forces with Visa and Mastercard. They pulled back their marketing support from Bankcard and with that went its customers. Bankcard's last advertising campaign was in 1994, on its 20th anniversary.
MWE Consulting managing director Mike Ebstein said the lack of marketing support by local banks and "functional disadvantage" in being an Australia-only card were the main reasons customers had turned away. Banks had also made it harder to apply for a Bankcard.
Mr Moffatt confirmed that over the years Visa and Mastercard had attempted to take over its customers, who will now be offered an alternative Visa or Mastercard by their banks.
The Commonwealth Bank holds the biggest portfolio of Bankcard credit card customers, with about 350,000. A bank spokesman said it would be writing to customers soon with the option of joining Mastercard.
"Bankcard changed the Australian financial services landscape forever when it launched more than 30 years ago, but an Australia-only credit card is simply not attractive in the current credit-card market," Mr Moffatt said.
At its peak, Bankcard had more than five million cards on issue. But it has struggled since the arrival of international credit card operators Visa and Mastercard in the early 80s.
Without any significant marketing spending by the banks who own Bankcard and without features such as loyalty points, the number of cards on issue has fallen to about one million and the office is now staffed only by Mr Moffatt and three other bankers on secondment.
By contrast, Visa's customer base has ballooned to 12 million and Mastercard's to six million.
Charge cards such as American Express and Diners Club were in Australia when Bankcard launched, but were still niche products for wealthy customers.
Mr Moffatt said Bankcard was now unable to match the features and benefits of internationally accepted cards. Before the arrival of Visa and Mastercard, Bankcard made an attempt to build international acceptance for the card, but negotiations failed.
The local banks joined forces with Visa and Mastercard. They pulled back their marketing support from Bankcard and with that went its customers. Bankcard's last advertising campaign was in 1994, on its 20th anniversary.
MWE Consulting managing director Mike Ebstein said the lack of marketing support by local banks and "functional disadvantage" in being an Australia-only card were the main reasons customers had turned away. Banks had also made it harder to apply for a Bankcard.
Mr Moffatt confirmed that over the years Visa and Mastercard had attempted to take over its customers, who will now be offered an alternative Visa or Mastercard by their banks.
The Commonwealth Bank holds the biggest portfolio of Bankcard credit card customers, with about 350,000. A bank spokesman said it would be writing to customers soon with the option of joining Mastercard.
© The Australian
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