Hispanics Are the Target For a New Card Offering
People's Bank of Connecticut on Tuesday introduced a credit card tailored for the Hispanic market.
Available in MasterCard or Visa versions at a relatively low 13.9% annual interest rate, the card is a joint offering with Telemundo Group Inc., a national Spanish-language TV network.
The terms are the same as for other cards issued by People's, which has $6 billion in assets. The difference is that People's is aiming directly at the Spanish-speaking market with an affinity card bearing the widely recognized Telemundo name.
"The Hispanic market is one of your most upcoming and powerful markets," said Ron Urquart, first vice president of consumer credit at the Bridgeport, Conn., savings bank.
Vast Potential Seen
Telemundo said the Hispanic market this year has $182 billion in purchasing power and holds vast potential for credit card issuers. About one in three U.S. Hispanics has some type of credit card. One in four has at least one of the major brands - Visa, MasterCard, or American Express - according to Strategy Research Corp. of Miami.
The Hispanic-oriented bank card, which People's claimed is the first of its kind, is the latest example of a bank's catering to that fast-growing community. In markets with large Spanish-speaking populations, institutions have been hiring Hispanic marketing specialists, adding multilingual capability to automated teller machines, and hiring Spanish-speaking customer service representatives.
Starting Nov. 25, People's will test-market the Telemundo card in Miami and San Francisco, the third- and fifth-largest Hispanic markets in the country. Telemundo will begin advertising the card on its stations in those cities next week.
People's plans to offer the card, which has a $25 annual membership fee, nationwide by early next year.
Secured Card Also Offered
The thrift is also promoting to the Hispanic market a credit card secured by funds in an interest-bearing savings account. Loan balances are charged an annual interest rate of 16.9%. "Many Hispanics do not have credit, or if they do have credit, they have very little credit," Mr. Urquart said.
He characterized the Hispanic community as "the hottest growth market in the nation."
People's, the largest savings bank in New England, has marketed credit cards aggressively as part of its consumer banking strategy. To boost capital, the thrift sold $200 million of its $600 million credit card portfolio last month to Banc One Corp. of Ohio.
About $50 million of its remaining $400 million credit card portfolio has come in from affinity programs with colleges, magazines, and Southern New England Telephone Co.
"Hopefully, the power of television will get us a very large response," Mr. Urquart said. He said the network reaches 5.9 million households, or an estimated 84.5% of Hispanic households, in 42 markets.
