Closing Branches and Reducing Sales Agents... Card Business Undergoes Structural Transformation

Rapid Decline in Offline Channels
Card Companies Cut Unnecessary Costs
"Beyond Simple Cost Reduction, It's a Structural Shift"

Credit card companies are continuing to reduce both their branch offices and their sales agents. As non-face-to-face channels expand and the drive to cut costs persists, a clear trend has emerged: traditional business models that relied on direct customer acquisition are being replaced by platform-based and partnership-driven strategies.

According to the Financial Supervisory Service's Financial Information and Statistics System as of April 16, 2026, the eight major standalone credit card companies in Korea (Lotte, BC, Samsung, Shinhan, Woori, Hana, Hyundai, and KB Kookmin Card) operated 158 domestic branches at the end of last year, a decrease of about 14% from 184 branches a year earlier. This decline is attributed to the shift of key services—including card issuance, usage management, and event participation—toward mobile applications and online platforms, which has lessened the need for physical branches.

Similarly, the number of card sales agents has also declined rapidly. While there were once more than 20,000 agents, as of the end of last year, only 3,324 remained. In the past, it was common for consumers to obtain new cards from agents stationed at large supermarkets or department stores. Now, however, it has become routine for consumers to apply for credit cards directly online.

The main reason for these reductions in both branches and personnel is mounting profitability pressure. As merchant fee rates have been slashed, core business profits have become more limited, and the burden of funding costs has increased, making cost reduction unavoidable. In reality, credit card companies are not only minimizing face-to-face channels but are also streamlining their entire organizations to cut overall expenditures.

Industry observers note that the shrinking number of branches and sales agents reflects more than just a drive for cost savings; it indicates a fundamental structural change in the credit card sector. The traditional model of credit card companies reaching out directly to customers is being replaced by a structure in which members are acquired through platforms and partners that already have established customer bases. A representative example is the Private Label Credit Card (PLCC). Through PLCCs, credit card companies can attract customers who use specific brands as their own card members. This approach is considered highly cost-efficient because it enables the acquisition of loyal customers without a dedicated recruitment organization.

This transition is also redefining what constitutes competitiveness for credit card companies. Whereas in the past, success depended on how many customers could be secured through face-to-face channels, now the ability to connect with digital channels where consumption actually occurs has become a more crucial factor. An industry official commented, "More consumers now see it as natural to use platforms or online channels rather than relying on sales agents to obtain a card. While part of this trend reflects the card companies' own shift to non-face-to-face channels, it is also the result of changing consumer perceptions." He added, "The reduction in branches and sales agents is not just about cost savings, but rather a sign that the very business structure has changed."

This content was produced with the assistance of AI translation services.