Discussion On The Integration Of Financial IC Card And The Business Mode Of City Card Industry

During the period of evolving from magnetic bank card to financial IC card, the Chinese bank card industry is facing more and more challenges. It becomes an unavoidable problem for every financial IC card issuing institution to maintain their favorable position and to open up new fields of applications. By researching the Financial IC card business model of integrating external industry resources, this thesis attempts to find a realistic way to expand the financial IC card application field, increase the users, and cope with the increasing market competition.First of all, the thesis uses PEST model to analyze the political law environment, economic environment, social environment and technical environment that financial IC card lies in, and learns that financial IC card is situating in a good managing environment. Then efforts are made to analyze the competition strength, consumers’ and suppliers’bargaining abilities, similarities of substitutes and the threat of new entrants in the personal face-to-face payment industry with the help of Five Forces model. From the analysis, it is easy to conclude that the existing competitors and consumers have a bigger effect in the personal face-to-face payment industry. At last, we analyze some disadvantages existed in the development of financial IC card.According to the analysis above, in order to adapt to the changing environment and cope with the increasing competition, this thesis puts forward Business Model Innovation in the financial IC card’s integrating external industry resources. By learning the theory of business mode innovation, basic methods of the financial IC card’s integrating external industry resources are raised and the main integrating targets are discussed. After that, take the city card as an example, under the frame of business model, efforts are made to elaborate on the value proposition, the value support and the value maintenance of the financial IC card business model of integrating external industry resources. The value proposition includes improving the experience of financial IC products, sharing client resources, increasing the income of financial IC card issuing institutions and increasing ways to profit for city card. The value support includes using the financial technical specification, compensating former investment of city card compensation and adjusting the profit model of city card. The value maintenance includes three aspects:the customer interface, the internal interface and the partner interface. Then strategic significance is analyzed from the aspects of resource integration, business model innovation and strategic Alliances.In the end implementation suggestions and risk factors are discussed.The industry resource of city card is a typical integrating target of financial IC card. By analyzing this specific case, this thesis gives a business model innovation for the participants of financial IC card industry and other industries, in order to form a win-win pattern of resource sharing and complementary advantages.