Credit cards: Conduits for value creation in Chinese retail banking

With domestic and foreign competitors encroaching and both private and governmental shareholders seeking additional capital, China's mid-tier banks are struggling to improve their financial standing and fund future growth. Meanwhile, the Chinese government is promoting consumer spending as one of its pillars for continued national economic expansion. But is there opportunity to do both – shore up bank valuations while simultaneously encouraging economic growth? The credit card business seems to offer a plausible answer – but only if banks can enter the market quickly and reach the point of profitability sooner than competitors.