(Yicai Global) Feb. 17 -- Standard Chartered China is optimizing its credit card application process and will start accepting applications again once the procedures are completed, the UK lender said on Feb. 15 after an earlier suspension of the service sparked market concerns that it was withdrawing from the Chinese credit card market.

No new credit card applications will be accepted from Feb. 20, Standard Chartered China said on Feb. 14. The lender had already suspended its online application channels early last month. Existing users will not be affected, it added.

Standard Chartered launched its credit card business in China in 2014 with two products aimed at the mid- to high-end income bracket. Since then, no new products have been forthcoming.

“Standard Chartered’s credit cards are not widely used in China, and perhaps the scale of their business is not large, so it is understandable if the bank decides to suspend this business,” Dong Zheng, a credit card market analyst, told Yicai Global.

A number of other foreign banks are also facing problems in the Chinese credit card market. In April last year, US lender Citibank said it is exiting consumer banking in 13 markets, including China. And British bank HSBC has cut the number of credit card products it has in China to eight from 20 a year ago.

Foreign banks tend to aim for mid- to high-end customers, of which there is a limited consumer base, and it is a segment where local banks are already established, Dong said. This means their customer acquisition costs are high. In addition, many international banks are not localized enough and use global business strategies resulting in services that do not cater adequately to local clientele, he added.

Editor: Kim Taylor