A Yikatong card
Yesterday I saw on BTV (Beijing Television Station) that the company responsible for Yikatong has been taken to court by a second-year university student for excessive profiteering. Yikatong is the card people use to pay for public transport and has become widely used in 2006. To buy the card, people must first pay a ‘deposit’ of 20 yuan and then pay an adjustable amount of credit to cover public transport costs. The use of the word ‘deposit’ is a bit strange because there is no clear indication that consumers can return the card and receive their money back.
According to the television report, the production cost of each card is four yuan. That means for each unit sold, the company responsible (a company associated with the Beijing City Government) will make an immediate profit of 16 yuan. Considering the huge amount of people who use the card (at least one million), that stands for a lot of profit. One of the other companies involved in Yikatong is CITIC, a large government-owned investment bank.
The profit does seem excessive, so I hope the court action will prove fruitful. During the television report, the journalist interviewed several members of the public and most seemed to think 20 yuan wasn’t too expensive. I guess that may have been the genius of the plan, make it cheap enough for the average punter to stomach, but sell it in huge numbers to maximise profits.
Report by China Youth Daily
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