The partnership with Nova Credit and HSBC to provide the credit history passport to expats entering the UK will boost HSBC’s credit card market share and improve customer centricity by breaking down financial hurdles for expats.

According to GlobalData’s Retail Banking Analytics, HSBC has experienced a steady decline in its credit card market share in the UK, as it fell from 12.2% in 2012 to 8.5% in 2022. A partnership with Nova Credit will inevitably improve HSBC’s competition in the UK credit card market and also utilises a gap in the expat market that may not be covered by other UK providers.

HSBC will be the first bank to allow migrants the option to include international credit history when applying for a credit card. 12 countries are included in this new policy, including Australia, India, Nigeria, Switzerland, and the US. The aim of integrating Nova Credit’s Nova Passport technology into the HSBC systems is to allow migrants to skip and/or break down the financial barriers that are in place when moving overseas. HSBC UK will be the second entity behind HSBC Singapore to offer this service to expats.

The countries that are included in this new service are important economic partners to the UK. The Office for National Statistics stated that last year, both study visas and skilled worker visas dramatically increased during the year ending March 2023. The year saw 66,796 Nigerian dependents granted sponsored study visas and 13,390 Indians granted skilled work visas, the latter up 63% from the year before. Being able to provide a convenient service such as the international credit history passport to this increasingly large clientele will inevitably increase HSBC’s dominance in the expat and credit card markets.

GlobalData 2023 Financial Services Consumer Survey

Being a large international bank with a recognisable brand, worldwide outreach, and focus on expat needs, HSBC is highly attractive to international customers. GlobalData’s 2023 Financial Services Consumer Survey shows that a ‘well-respected brand’ is a key driver for credit card provider choice, alongside ‘offered best reward programme’ and ‘I was already a customer.’ HSBC should use its strong brand reputation to attract expat customers to its new credit history passport. In doing so, it can promote the new service’s benefits, zoning in on the fact that its convenience is more attractive than rewards and staying with original providers. Consequently, there is a great opportunity for HSBC to tap into a huge expat customer base and become increasingly dominant in the credit card market.

Phoebe Hodgson is an associate analyst, banking and payments, GlobalData

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