Google News

Canadian bank to have card facility with retailers

Must Read

With credit crunch in Canada, the Chief Executive Officer David Taylor of Pacific and Western Credit Corp is close to breaking into the “non-traditional” banking area of consumer lending business as he has held talks with a couple of retailers.

“If we were lucky enough to do a deal with two large Canadian retailers, the credit cards that we could potentially have through that distribution channel would be larger than any Canadian bank,” he said. “That’s a monumental shift.”

There are expected to be 67.2 million credit cards in circulation in this country in 2010, representing the most lucrative areas of retail banking with credit cards in Canada increasing 7 per cent annually on average for the last three years.

But cards would just be the start as Pacific & Western could then create whatever range of lending products the retailers want.

Then there’s the credit crunch, which came at an opportune time for Taylor. “We’re able to fund the credit card receivables with our deposits, which is, in times of liquidity crisis, a huge advantage,” he said.

“The big retail banks in the world are facing – in the retail area – the largest threat they’ve ever faced,” he said.

The threat is retailers, who have proven in the past couple of years that they can be bankers, too. It’s the tremble of apprehension coming from executives as they wait to see just how far Wal-Mart pushes into the financial services arena in Canada.

Last month, the retailing behemoth, with 287 stores in this country, announced that it will roll out Western Union money transfer services across Canada by early 2008. The move was widely seen as a first step into the financial services realm, and the chain hasn’t hidden the fact that there will be more to come.

Recently the Canadian bank got authorization to issue Visa credit cards. Now it’s trying to talk a few major retailers into forming a partnership that would see their brand stuck on the cards, which could be used anywhere Visa is accepted. Card holders would earn points that could only be cashed in for goods at that retailer. Taylor has his sights set on a couple of major chains in different industries such as home hardware and drug stores.

Taylor is optimistic he’s getting closer to signing on the dotted line with some stores. “Over the last year or so we’ve been bringing this idea to large, mainly Canadian, retailers, but the idea now appears to have traction.”

“What we’ve been looking for is an opportunity to touch the retail market, but not have to change our core belief and that’s that we should market through existing distribution channels,” he said

Latest News

Being Human Clothing receives 5 awards at IFF 2024

The event also awarded brands such as Rare Rabbit, Tommy Hilfiger Vero Moda, Mini Klub and United Colors of...

Login to your account below

Fill the forms bellow to register

Retrieve your password

Please enter your username or email address to reset your password.