In between clicking his computer mouse while working on a presentation, Baskoro Adi, a 26-year-old scriptwriter was interrupted by the ringing of his cell phone.

The lady on the other end of the line offered to transfer the outstanding balance from his credit card to a savings account.

"There are no charges, and you can pay the balance off by monthly installment," the state-owned bank's customer service officer quickly added.

After some quick calculations, Baskoro said OK as he could see no harm in it.

"I'm only wondering, though, what's in it for the bank?" he said.

Offers like this, new and innovative some might say, lead to one inescapable conclusion: Indonesia's banks are desperate to increase credit-card usage.

At times when lending rates are high, corporate lending becomes risky, both for the banks and the borrowers, making consumer lending through credit cards an easier way for the banks to make money.

With prize draws and other gimmicks designed to encourage increased credit-card usage losing their appeal, offers like no-interest balance transfers, cash-back offers for particular transactions and low cost insurance cover are now the favorite ruses resorted to by the banks.

"The competition in the credit-card business is getting tighter, and the banks are seeking new ways of increasing their business," Citibank credit-card marketing director Djamin Nainggolan told The Jakarta Post recently.

Holding a some 30 percent market share of Indonesia's 6.5 million cards as of December 2005, Citibank has opted to attract new customers by catering to every market segment.

"We provide cash-back cards for the reward seekers, no-frills cards with low annual fees for the functionalists, and affinity cards for more clearly defined groups," Djamin explained.

The country's largest lender, Bank Mandiri, has opted for a different strategy by offering to transfer the outstanding balance from a holder's current credit card to its Visa card, with the main attraction being the offer of lower interest.

Mandiri corporate secretary Eko Putro said the bank had lowered its growth target for new card holders to 20 percent from 30 percent last year following a recent central bank directive urging banks to be more prudent in issuing credit cards.

With 80 percent of its 750,000 card holders coming from the middle class, the bank also offers a point rewards scheme, where accumulated points can be exchanged for goods or benefits.

Meanwhile, the country's fourth biggest credit-card issuer, Bank Internasional Indonesia (BII), operates a cash-back program for credit card transactions.

This has resulted in a shift in the composition of its total loans from 60:40 in favor of corporate customers to 30:70 in favor of retail customers.

Separately, Bank Central Asia issues a lifestyle card by which holders get two for the price of one in places of entertainment.

The BCA card, which attracted 170,000 new subscribers last year alone, is a favorite among young professional people.

The head of Bank Indonesia's national payments system bureau, Diah NK Makhijani, said the banks were allowed to make innovative marketing offers as long as they informed their customers about any hidden charges.

Separately, Indonesian Consumers Foundation (YLKI) worker Indah Suksmaningsih urged the banks to provide better and clearer information on the offers made to potential cardholders.

"Many of our consumers are still illiterate when it comes to financial services," she said.

I-box

What some of the offers really mean:

1. Transfer balance with no-interest for the first 6 months An interest-free grace period of six months is extended to transferred balances, with interest only becoming payable after the expiry of this period. Such offers can benefit a cardholder if the transferee bank charges a lower rate of interest than his previous bank.

2. Transfer balance to savings account The transferred balance is paid by installment over 12 months, with the installments already including interest. Cardholders should calculate the total amount they will end up paying and compare it to the interest they would receive by putting their money in a savings account.

3. Cash-back offers The cardholder is exempted from paying a certain percentage of the transaction value, or is awarded points that can subsequently be used for making further transactions.

Credit card statistics (as of December 2005)

Number of issuers : 21 (19 banks and 2 non-bank institutions) Number of cards issued : 6.5 million Number of actual holders : 3 million Number of transactions : 97.6 million Transaction value : Rp 55.29 billion

Source : Bank Indonesia & Indonesian Credit Card Issuers Association.