UAE's joint credit card venture with Japan

Majid Al Futtaim Group is about to launch the region's first consumer-geared credit card against the backdrop of the heightening economic crisis.

DUBAI // Majid Al Futtaim Group has announced a three-way joint venture with JCB, Japan's leading international credit card company, and ORIX Corporation, Japan's largest financial services conglomerate, to launch a regionally-oriented credit card. At the launch yesterday, Rasool Hujair, the chief executive of the new company, Majid Al Futtaim JCB Finance (MAF JCB) said the financial outlook of the UAE remained strong. "In this difficult time, if there is one, this product provides extreme value for consumers. They will be able to make incredible savings," he said. "We are glad to launch at this time because the value of our product will be seen as even greater." The new card is called the Najm JCB Credit Card. While he would not reveal the value of the venture, Mr Hujair said MAF Group would be the largest shareholder in the new company with 60 per cent, followed by ORIX with 30 per cent and JCB with 10 per cent. The deal marks the first joint venture for JCB in the Middle East. "The subprime issue, I don't deny, has a negative impact on every sector, but the consumer sector will probably be the least affected," said Tamio Takakura, the president and chief executive of JCB. The Bank of Japan injected ¥1 trillion (Dh35.6 billion) into the Tokyo money market on Tuesday as part of efforts by the world's central banks to ease the global credit crunch. However, officials with ORIX and JCB said Japan's economy remained strong, calling last week's meltdown merely a "side effect from the big wave" hitting the US financial markets. "To a certain extent, we have been affected, but this is not our financial problem," said Yukio Yanase, the executive officer, president and chief operating officer for ORIX Corporation. "We are in the middle of a financial crisis and it is an unprecedented scare, [however] this region is safer and stable." The Najm JCB Credit Card will provide consumers with a basket of savings and benefits, including 50 per cent off purchases at Carrefour, 25 per cent off of many MAF Fashion brands and discounts at other MAF brands including Ski Dubai and the Kempinski Hotel at the Mall of the Emirates. Consumers will receive two per cent cash back for purchases at MAF retail partners including Carrefour, Mexx, Liz Claiborn and others, plus one per cent cash back on all other purchases with no minimum spending caps. Mr Hujair said MAF JCB expected to hold as much as 20 per cent of the market share in five years, adding that they hoped to make the card available to consumers across the region in the near future. Despite the confidence of MAF JCB executives that the region is resilient in the face of the global slowdown, recent surveys have been a cause for concern. The latest Bayt.com-YouGovSiraj survey released in August showed a drop in consumer confidence in the UAE, Bahrain, Saudi Arabia and Qatar, as well as in Morocco, Algeria and Egypt. [e-mail]