• In 2021, KEB Hana Card expanded into auto finance and card processing businesses, the latter for Toss Bank, to create additional income sources. It also established the foundation for providing comprehensive financial services by entering open banking and MyData service business. Boosted by these efforts, COVID-19 stimulus and other government policies aimed at facilitating consumption, card transactions increased 5.4% YoY. In addition, KEB Hana Card realized strong growth thanks to improved efficiencies brought on by digital innovations realized in the form of processing cost reductions (transaction approval/purchase, third-party service fees). Its strong business performances in 2021 include processed transactions of KRW 70.5 trillion, operating income of KRW 343.8 billion, and a record-high net income of KRW 250.5 billion. Increased transactions and improved profitability boosted total assets to KRW 9.6 trillion and ROE to 13.1%. Despite COVID-induced lockdowns, it ended the year with a stable delinquency rate of 0.97%. In consideration of insolvency risks kept high by continued COVID-19 fears, interest rate hike expectations, and rising household debts, KEB Hana Card plans to maintain asset soundness in a stable range.

Reflecting persistent COVID-19 circumstances, overseas merchant transactions, which rose 9.1% YoY in 2021, did not return to pre-pandemic levels. To restore the figure, KEB Hana Card is conducting marketing activities targeting students studying overseas, duty free shop customers and other travelers. In addition, in preparation for a post-COVID era, it secured overseas marketing hubs, a step to launching card services primarily in travel bubble countries. Also, the company will strengthen specialized products designed for overseas use and launch marketing campaigns in link with platform and travel industries catering to overseas travelers.

2022 PLANS

• KEB Hana Card will enhance the competitiveness of its platform, 1Q Pay, and expand the customer base by increasing collaborations with the Group affiliates and strategic alliance projects to achieve stable and profitable growth. It will develop 1Q Pay into a comprehensive financial platform that enables customers to conduct banking, asset management, and expenditure management as well as payment settlement. Utilizing such inclusive platform, it will expand into comprehensive payment business. Also, by offering stable comprehensive financial services to its customers and merchants and thus expanding its customer base, KEB Hana Card will take on the challenge of competing against big tech companies. To facilitate the MyData service launched at the end of 2021, the company is partaking in the joint Group project of branding and customer attraction. It also plans to launch full-fledged MyData service-based new income products by expanding services to include product comparison and recommendation.

Merchant fee rates are recalibrated every three years in accordance with the method defined in the amended Specialized Credit Finance Business Act of 2012. Based on the rates accordingly readjusted for 2022, the card industry is expected to see fee income decline by around KRW 470 billion in the year. Accordingly, also expecting a drop in fee income of around KRW 37.0 billion, KEB Hana Card plans to minimize the impact by achieving growth of our fundamental business, continually creating new income sources, and curtailing processing costs through digital innovation.