Strategic responses to competition by Barclays Bank of Kenya Limited in the credit card issuing business

Abstract

From the study it is clear that BBK is facing a dynamic competitive environment in the credit card issuing business. In view of this the focus of the study is to find out, if indeed BBK is responding strategically to competition and if so, our interest is on how it has done it. The main objectives of the study were to identify the nature of competition facing Barclays Bank of Kenya Limited in its credit card issuing business, Establish how BBK is responding to the competition therein and identify the challenges it is facing in responding to competition in the credit card issuing business. The research design applied in the study was a case study research design and data was collected through a face to face interview of respondents in Barclaycard section of BBK, with the use of an interview guide. This data was later analyzed through content analysis and presented in form of narratives. The results of the study indicated that BBK is facing competition in the credit card issuing business mainly from KCB, Equity Bank, CBA, Co-operative Bank and CFCStanbic Bank. The strategic responses unearthed from the study were market segmentation, elimination and reduction of some tariffs, co-branding, core banking platform systems change, streamlined customer service, insurance, customer redeemable reward points, marketing and promotions. There were also challenges faced in adopting strategic responses that included slow decision making due to bureaucracy and prohibitive costs of adopting new technology and developments. In conclusion it is evident that the strategic responses adopted by BBK in the credit card issuing business are working but are yet to reach the optimum level. The bank needs to adopt strategic responses more aggressively, fasten the decision making process through elimination of bureaucracy and willingly adopting new technology, regardless of the high capital intensive cost. In essence BBK will be able to get a stronger competitive edge and adopt timely strategic responses that will yield greater competitive results in its favour.