Tapping into the potential
With its re-launch, Diners Club
Oman heralds an intention to emerge as a major force within the
credit card industry in the Sultanate. Robert Sharpe, chief
executive, talks to Muhammed Nafie about the company’s
strategies to meet the growing market for credit cards in the
Can you explain about the concept of Diners Club and its
Diners Club is the first independent charge and credit card
in the world. There is an incredible story about its origin.
When Frank X McNamara went out for dinner one evening back in
the 1950s he forgot his cash and got very embarrassed as he
couldn’t pay the bill. So he decided that he would start off a
card that would enable people to pay, primarily, for their
dinner and that is why it was called Diners Club.
And from there it developed considerably to be a major travel
and entertainment card and then, in many countries, a leading
credit/charge card. Although a number of people have bought the
business including Citibank, it is now owned by Discover
Financial Services, a large, and very successful, payment
service company in the US and globally. Discover is able to
achieve a lot of synergies from their existing payment business
for the Diners Club brand. It is an interesting concept because
Discover owns the brand “Diners Club International” and
everything about it, but it has individual franchises in various
countries around the world which manage the operation on a
day-to-day basis. The local issuing banks hold the credit card
receivables on their balance sheets but pay royalties to Diners
Club International for the use of the brand, marketing support,
system support etc. There are franchises all over the world.
Commercial Bank of Qatar owns the Omani and Qatari franchises.
What is the significance of your recent re-launch in Oman?
The re-launch is an interesting story. The Diners Club card has
been in Oman since around 1980 and the franchise has been
through a number of different ownerships. But it has never been
marketed aggressively or been a leading force in the Oman card
market. When Commercial Bank of Qatar, which owns 35 per cent of
National Bank of Oman (NBO), bought the franchise from the then
owners in 2007, the idea was to make it part of the overall NBO
But, for a number of reasons that has not happened, although NBO
has recently provided all their Sadara customers with a Diners
Card. When I joined Commercial Bank of Qatar at the beginning of
2011 and became an independent director for NBO, I also looked
into the opportunity to launch a standalone credit card (Diners)
in the Sultanate. When I compared the financial services market
here to that of the US and Europe, I could see there was
something extra we could bring to the Omani market and that was
personal service. I strongly believe when you launch a product
with a real service promise and you deliver on that promise,
then people will start using the product and being its best
I also thought that with the economy of the country growing
there was a potential market for a new credit card targeting the
high-net worth and affluent individuals. I also spoke to the
Central Bank of Oman and they were supportive of any initiative
to encourage electronic banking and take more physical cash out
of the market. I therefore agreed a business plan with the
Commercial Bank of Qatar to re-launch the Diners Card in Oman.
What segment of customers you are targeting?
Diners Club are not competing with the mass market credit cards,
but we are providing an exceptional high standard of personal
service for high net worth and affluent individuals who can take
advantage of the features of the card. We are looking at people
with a minimum monthly salary of circa RO2000 per month. We have
had a lot of applications from people below that level and we
just politely say that this is not the market segment we are
looking at. There are another two areas of great opportunities
for us. I did not really see a card specifically marketed to the
corporate sector which enables the corporates to provide a card
for all its senior management team to be able to travel and to
entertain. In addition, the SMEs were slightly neglected in
terms of their ability to manage their cash flow and I think a
card carefully underwritten and carefully managed can give SMEs
an opportunity to better manage their cashflows. In September,
we will be launching a corporate card specifically designed as a
travel and entertainment card for corporate and SME customers.
Another area is the travel segment where we can tie up with
large corporate and travel companies to fund their travel
arrangements. We are also looking at a ladies only card with
different attractive features designed specifically for the
ladies in Oman and meeting their requirements in a credit card.
What are your unique selling propositions?
In terms of the price, we have the most competitive interest
rate in the market. We have excellent service as we provide a
24-hour contact service and for high-net worth individuals and
they will have their own personal relationship person who they
can call at any time. This will be a personal relationship
manager based in Oman, who will be available to provide instant
service whenever and from wherever the customer calls. We will
also be in touch with our Diners Card customers on a regular
basis to update them on new features and services available on
the card. The card also provides complementary access to 450
airport lounges worldwide, a simple loyalty reward programme,
leading insurance cover, coupled with the lowest credit card
rate of interest in Oman and the personal service aspect makes
our card a unique proposition. Everyone has insurance coverage
of various descriptions on every credit card but not a lot of
people are actually aware of what they have. We have provided
one of the best offerings in the market and we are explaining to
our customers exactly what coverage they have available.
What about your interest rate and fee structure?
We got a standard annual fee. But at the moment we are giving
the discount for new customers. Our interest rate is 1.25 per
cent per month and that is the lowest in the Sultanate.
How is the response from the market so far?
Since we launched at the end of June we have signed a couple of
hundred new customers. We already had a small base of customers
and NBO has around 2000 Diners Club cardholders as part of its
card offering to their Sadara customers.
What about the acceptance of your cards in the retail market?
In the retail market our cards are accepted virtually
everywhere. Following a major merchant sales campaign before our
launch, Diners Club is now accepted in over 3000 shops,
restaurants, hotels, petrol stations and other outlets in Oman.
The cards can also be used in more than 185 countries, millions
of merchant locations and 845,000 ATMs globally making the card
a perfect travel companion for any Omani customer travelling to
Dubai for the weekend or further away on business or holiday.
May - 2013
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