Frequent card use signals positive sign

By Zhang Fengming | April 10, 2009, Friday |

Print Edition

CHINESE consumer confidence in major cities is recovering, China UnionPay Co said yesterday, citing an index based on bank card transactions.

The Bankcard Consumer Confidence Index tracks transactions of frequent bank card users in nine major Chinese cities, including Shanghai, Beijing, Dalian and Guangzhou. The users frequently use the cards to pay for 90 percent of their expenses.

The index showed signs of recovery in the first quarter of this year, Shanghai-based UnionPay which tracks all yuan-backed bank card transactions in China, said yesterday. The index rose to 86.95 in the first quarter of this year. It was up from 86.88 in the fourth quarter last year and 83.62 a year ago.

The quarterly index fluctuated last year - it rose to 86.59 in the second quarter but tumbled to 85.31 in the third quarter, and then managed to inch up in the last quarter.

The index was set up in the first quarter of last year and tracks non-necessity expenses of the card users, which include 200,000 individuals in the affluent cities. The higher the index, the more bank cards are used to pay for non-necessity expenditure such as luxury goods and travel.

"The rising index in the first quarter showed Chinese consumer fundamental confidence is showing an optimistic trend, indicating China's big potential for domestic consumption," said Xu Luode, UnionPay's president. He sees the index to keep rising this quarter.

Finance

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Frequent card use signals positive sign

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