Pioneer Credit enters the payment card market

Debt servicer Pioneer Credit is launching a range of credit and debit cards, working in partnership with the authorised deposit-taking institution Goldfields Money.

Pioneer Credit announced yesterday that it had finalised a memorandum of understanding with Goldfields Money (in which Pioneer has a 14.1 per cent holding) for the development and management of range of financial products.

Pioneer, which was listed on the Australian Securities Exchange last year, acquires and services unsecured retail debts that are more than 180 days overdue. Ninety per cent of its purchases are credit card and personal loan receivables.

The company does not see itself as a debt collector, however. Its business model involves developing customer relationships with the debtors it acquires through its credit purchases.

A company spokesman said: "Pioneer forms a relationship with the customer, working with them to pay off their loan over a period of time. Pioneer has a strong focus on customer service and treats these people as customers, not debtors."

The company said it had 110,000 customers. The debit card will be offered to the customer base.

The credit card will be offered initially to customers who have paid off their outstanding accounts. Pioneer plans to offer the credit card to the broader market eventually.

Goldfields Money will be the issuer and will bear the credit risk. Pioneer will handle customer acquisition and "operational development".