Most VIPs use junket credit
News that the Chinese government is increasing its oversight of cash transfers via debit cards as part of a crackdown on illegal transactions may have overstated the importance of the cards.
According to GGRAsia, most high rollers (including so-called “tigers,” government and business bigwigs suspected of corruption) don’t use UnionPay at all, but rely on junket credit.
“Only the small and very low-end VIP player uses UnionPay to obtain cash,” wrote Credit Suisse analysts Kenneth Fong and Isis Wong in a recent note. “So going after UnionPay transactions logically won’t capture the ‘tigers.’”
Deutsche Bank research analyst Karen Tang says UnionPay transactions account for “30-40 percent of premium mass, and 10-15 percent of VIP revenue.”
Some reports claimed the government would involve the Macau Monetary Authority in its effort to ferret out high rollers involved in money laundering. Untrue, said the analysts.
“If the China authority wants to monitor suspicious transactions … they should have all the information in the Chinese banks who are the card issuers,” wrote the Credit Suisse analysts. “They don’t need to involve the Macau Monetary Authority.”
