Research On Competition Of Credit Card Based On Switching Costs

As an important organic composition part of banks' intermediary business, the credit card business can escape restraint of the balance sheet and bring huge profits. As the main army of banks' intermediary business, the credit card service may bring the considerable interest return for the bank, through high fine interest. The card service is also the platform of the banks' other cross services, lays the foundation from which the bank will gain in the future. These service's development is helpful to improve the commercial bank's property quality, optimize customer resources and enhance profit ability. Therefore, the domestic banking industry has launched keen competition in the credit card service, enlarged the credit card service investment, adopted all kinds of strategies to enhance their own competitivity.This article takes the credit card as the study object, explains strategy competitivity questions related to our country credit card service by switching costs. Differently from former studies, this article has been clear about the switching costs constitution of credit card service, used the various essential factors to construct econometric model and used first-order difference and fixed effects model of panel data to reduce basic model, established the the fixed effects competitive model. Analyze the relationships among various essential factors. Then it analyzed the influence of each kind of competition strategy on the bank card service competitivity, proposed suggestion to our country's credit card industry.Form studies, we discovered that (1) there is flaw when banks use their own resources talent. (2) Each bank's intercross effect is not fixed, along with the development of bank's cross business and seepage, the interaction between bank and bank is also changeable, sometimes strong,and sometimes weak. (3) Overdraws, amount of credit card score and ROE is reverse to PE. (4) The amount of the credit card holders is reverse to PE. (5) Annual fee and commission may be reverse to PE. Therefore, as to solve existing problems of our credit card competition, we can adopt the following strategies:Strengthen own resources utility and sets up the brand superiority; Overall plan competition strategy and coordinat credit card service cross-effect; Raises the credit card utilization ratio and enhance the limit of credit card; Standard credit card industry rule and raise the information flow efficiency; Depends on individual credit system, construct related credit industry chains.