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Card power

For high net worth or ultra wealthy individuals, the cards they are invited to own are different creations altogether, and include a host of benefits above and beyond the standard offerings

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FOR the proverbial red carpet treatment, you need look no further than a luxe credit card. It seems there is almost nothing the concierge team behind a luxe card - on call 24/7 - can't do. Or, at least they try very hard.

Here's a sampling of Singapore client experiences: A relationship manager for the American Express' Centurion card went out of her way to facilitate insurance claims for a client who needed emergency surgery in the US. She checked in with the cardmember, and liaised with the hospital and insurer daily for more than a week.

DBS Insignia's concierge team planned the wedding of a long-standing client. UOB Reserve recovered a stuffed rabbit from a Hong Kong hotel room for a client's daughter, and couriered it to Singapore within a day.

For most people, a credit card is a utility to swipe or tap for a cashless transaction. But if you are a high net worth or ultra wealthy individual, the cards you may be invited to own are different creations altogether.

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To be sure, you will get air miles, a standard and very competitive feature - they're akin to currency in Singapore's competitive card landscape. For some cards, payment of annual fees earns substantial bonus miles which are coveted by clients.

Beyond miles, you get a host of benefits, such as access to airport VIP lounges, lifestyle perks including spa and club access, dinner and show bookings.

For this piece, we requested information from banks and card issuers on their top-end luxe cards. In our compilation, Amex's Centurion card is conspicuous in its absence.

This is because Amex positions Centurion as the creme de la creme of cards, and maintains a strict silence on it. The Centurion is by invitation only. Its fees are the highest: reportedly a joining fee of over S$7,000, and a non-waivable annual fee of a similar amount. Its air miles conversion rate is reportedly not the highest in the market.

LUXE credit card benefits are broadly comparable, such as bespoke services via a solicitous concierge team. Bookings at overseas Michelin-starred restaurants, theatre and opera and even private jet arrangements are par for the course, says OCBC head of credit cards, Vincent Tan.

One other benefit, albeit intangible, is surely the implicit and gratifying sense the card bestows on its owner of having arrived.

Luxe cards' target users are among the most coveted of clients, with a net worth in the millions of dollars. Numerous wealth studies attest to the steady rise of high net worth individuals here, both in terms of population and sheer wealth. Credit Suisse Wealth Report 2018 puts the number of millionaires in Singapore at over 187,000. This is expected to grow by 5.5 per cent a year to exceed 239,000 by 2030.

Banks report higher-than-average usage of their luxe cards. Choo Wan Sim, UOB head of cards and payments, says billings of the UOB Reserve Card has risen steadily, with "healthy" year-on-year growth of over 20 per cent in the past three years.

"UOB Reserve cardmembers spend more than 20 times what the average UOB customer spends on their credit card."

In 2017, the bank created the UOB Reserve Diamond card as a limited edition card for top tier clients. The card is for members who spend over S$1 million annually on their card.

OCBC has the VOYAGE series, of which the top end is the Bank of Singapore VOYAGE card, exclusively for BOS clients who have assets under management of at least US$5 million. There is also the OCBC Premier VOYAGE card (AUM of S$200,000) and the OCBC Premier Private Client VOYAGE card (AUM S$1 million).

OCBC's Mr Tan says the VOYAGE cards outpace other luxe cards in terms of cardmember spending. In the last year, VOYAGE cards saw a 45.5 per cent growth in overall billings, more than thrice the industry average growth of 15 per cent, and a higher overseas usage. "With the prevalence of web shopping, VOYAGE credit card customers' online spend grew six times faster (97.3 per cent vs industry average of 17 per cent), and also achieved encouraging annual expenditure … with each customer spending 10 per cent more compared to the industry average."

Chew Yung Jin, DBS head of card products, says the DBS Insignia Visa Infinite card has seen membership increase year-on-year since its launch in 2011. Cardmember spending has also nearly doubled, which "… combined with rising membership figures, speak well of how strongly DBS Insignia' value proposition resonates with our clients".

TRAVEL is a major part of its benefits.

Today, 90 per cent of rewards redemption by DBS Insignia clients is for air miles. More than 26 per cent of members' spending and 35 per cent of concierge requests are travel related.

Vikas Kumar, Citibank Singapore head of cards and personal loans, says demand for Citi ULTIMA "continues to be overwhelming" since its launch in 2008. "Beyond the special privileges it is the dedicated service from lifestyle relationship managers and attractive earn rates that make it a rewarding experience to own." Standard Chartered Bank's Natalia Goh, head of credit cards & personal loans, notes that affluent clients are savvy and discerning. "They are willing to pay higher annual fees for a credit card with the expectation that they can enjoy more benefits and better service."

Stanchart Visa Infinite (VI) cardholders travel frequently for work or leisure and hence, they value the ability to earn higher air miles.

"They like that our VI card offers up to three miles for every dollar spent in foreign currency (with a minimum spend of S$2,000), which is one of the highest earn rates in the market.''

AS FOR Amex, the Platinum card was first launched in 1998, and the firm "refreshed" the cards' benefits last year. "The definition of success has evolved – it's not just about finding fulfilment from what people can buy, but also from having meaningful experiences and relationships," said Alex Chi, Amex director and head of product loyalty and partnership.

"Since launch, we've seen very strong engagement among both existing and new customers across several key areas such as lifestyle and events," said Mr Chi.

Another way in which issuers try to outdo the competition is in the material of the card. DBS Insignia, for example, claims to be the world's first Visa payWave-enabled metal card. The cardholder's name is engraved onto its cardface.

OCBC's VOYAGE card is made out of duralumin, which Mr Tan says is a first for credit cards in Southeast Asia. Duralumin is a hard but lightweight aluminium alloy that is resistant to corrosion by acid and seawater.