Banks voiced unanimous opposition yesterday to the nation's financial regulator's proposed plan to revoke the bonus point collection scheme for newly issued credit cards, saying it was an unnecessary and micromanaging measure.
"As the Financial Supervisory Commission has imposed many restrictions on credit card applications, we don't think it's necessary to deprive users of the benefit," said an official with a leading credit card issuer, on condition of anonymity.
Since the financial sector was hid hard by the consumer bad loan crisis in the second half of last year, the commission and the legislature have tightened regulations on the credit card business to curb further card abuse.
They have demanded that consumers submit personal financial documents when applying for credit cards, and increased the minimum payments for each month's new card sales from the original 2 percent to 10 percent to prevent outstanding debts from snowballing.
The commission has also forbidden financial institutions from setting up booths outside banks to hawk financial products, or from excessive incentives such as lavish gifts to successful credit card applicants.
"With so many restrictions [already], credit cards will become too boring if bonus points are removed," the official said.
The official added that the point collection scheme merely serves as a loyalty program for users, and has scant connection with spiking consumer debt, as few consumers apply for credit cards based on a certain bank's bonus points.
The ongoing dispute dates to the end of last month, when the commission submitted its draft amendments to the Regulations Governing Institutions Engaging In Credit Card Business (
Among the proposed changes, one clause stipulates that banks should cease awarding bonus points on newly issued credit cards.
The bank association is scheduled to discuss the controversial clause in a committee meeting next week and will submit their final opinions to the financial regulator at the end of the month.
The FSC will then convene public hearings on the issue before finalizing the draft amendment, according to the bank association.
One association committee member said that none of the banks supported the proposed change, saying that the commission should not interfere with their promotional strategies, many of which are also common overseas.
Richard Yang (楊鎧榮), vice president for consumer banking at Chinatrust Commercial Bank (中國信託商銀), the nation's largest credit card issuer, said that offering bonus points does not necessarily stimulate card users' consumption.
"It's more like a rebate program, boosting consumer loyalty to the issuing bank. We really hope that the scheme will continue to work," he said.
FSC chairman Shih Jun-ji (
He said that the ideas were brought up with the intention of correcting the authority's loose supervision of the card market and banks' imprudent issuance of credit cards.
The regulator hoped to make policies that can strengthen the consumer banking sector, Shih added.
According to the commission's statistics, the total revolving credit balance for credit cards stood at NT$403.2 billion (US$12.3 billion) in July, with an average bad loan ratio of 2.92 percent.
That's down from a high of NT$495.3 billion in November last year.
additional reporting by Amber Chung
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the
FUTURE PLANS: Although the electric vehicle market is getting more competitive, Hon Hai would stick to its goal of seizing a 5 percent share globally, Young Liu said Hon Hai Precision Industry Co (鴻海精密), a major iPhone assembler and supplier of artificial intelligence (AI) servers powered by Nvidia Corp’s chips, yesterday said it has introduced a rotating chief executive structure as part of the company’s efforts to cultivate future leaders and to enhance corporate governance. The 50-year-old contract electronics maker reported sizable revenue of NT$6.16 trillion (US$189.67 billion) last year. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), has been under the control of one man almost since its inception. A rotating CEO system is a rarity among Taiwanese businesses. Hon Hai has given leaders of the company’s six