(Yicai) Dec. 24 -- Postal Savings Bank of China is the second major lender after Bank of China to announce it would gradually shut down its credit card app services.

PSBC will stop updating the PSBC Credit Card App and migrate related functions to its general-purpose PSBC App, the lender announced on Dec. 22. This came three months after a similar statement by BOC.

The integration of credit card services by small- and medium-sized banks began earlier, with China Bohai Bank, China Zheshang Bank, Evergrowing Bank, and Bank of Ningbo closing their respective apps last year. Ten other small lenders, including Jiangxi Bank, have shut down their credit card apps so far this year.

"With the slowdown in the growth of credit card issuance, the proportion of the credit card business to banks' credit structure has declined," a credit card business representative at a Chinese joint-stock bank told Yicai. "In this context, the value of independent credit card apps has become difficult to justify, given their high operating costs."

Behind every app lies an entire system of development, testing, operations, and security, the representative said, adding that tasks, such as making system updates, adapting to new devices, and fixing security vulnerabilities, along with continuous marketing investments, have caused apps' operation and maintenance costs to keep surging.

With insufficient user engagement, integrating credit card app functions into main apps has become a practical choice for commercial banks to enhance efficiency, said Xue Hongyan, a special researcher at Jiangsu Su Merchants Bank.

One bank having multiple apps is inconvenient for users, Xue added. In fact, as mobile financial services become increasingly frequent and integrated, they are more inclined to use a single, comprehensive app with unified functions, he explained.

Regulators are also supporting and guiding this integration trend. A policy document released by the National Financial Regulatory Administration in September last year required banks and insurance companies to integrate or shut down apps with low user engagement, poor user experience, redundant functions, and potential security risks.

Lenders need to strengthen their ‘one bank’ digital strategies and continuously optimize the integration path of online services based on user habits, said Su Xiaorui, a senior researcher at Suxi Research.

Editors: Tang Shihua, Futura Costaglione