NAB Launches Co-Branded Credit Card with American Express

Strategic Insights -

National Australia Bank (NAB), the country's largest lender, has partnered with American Express to launch a co-branded credit card, offering enhanced loyalty bonus points and linked to the customer's savings and cheque accounts. This move comes as the credit card industry faces increasing profit pressure due to high loyalty bonus costs and a slowdown in card growth. The new card, called "Ant," is designed for big spenders who pay off their balances on time and want to collect reward points.

Key Takeaways:

  • The co-branded credit card, "Ant," is targeted at big spenders who pay off their balances on time and want to collect reward points.
  • The card offers enhanced loyalty bonus points, including Qantas frequent flyer points, and a special offer of two points for every $1 spent on eligible purchases until July 31.
  • NAB is responsible for issuing the cards and providing all support functions, while American Express provides global merchant access.
  • The card market is undergoing significant changes, with the Reserve Bank's cut in transaction processing fees making card ventures with Visa International and MasterCard International less profitable.
  • Other banks, such as ANZ and Westpac, have also partnered with American Express and other companies to offer co-branded credit cards.

Statistics:

  • The new credit card has been launched by NAB, the nation's largest lender, which accounts for about 1.6 million credit cards (out of 11 million) and $134 billion in annual spending.
  • The Reserve Bank's cut in transaction processing fees has made it less profitable for banks to offer credit cards with Visa International and MasterCard International.
  • The card market is maturing, with card growth slowing down.
  • The new card, "Ant," has a distinctive matt black background and is intended for customers who pay off their balances on time.

Sources:

NAB's general manager, cards, Fiona Wardlaw, cited in (National Australia Bank, 2023)

Reserve Bank, cited in (National Australia Bank, 2023)

Industry statistics, cited in (National Australia Bank, 2023)

American Express, cited in (National Australia Bank, 2023)