Western banks piling in to the Chinese credit card market are likely to see little or no profits by 2010, according to an analysis by Lafferty Group, the banking research and advisory firm.

It calculates that Chinese banks lost $84m before tax on credit cards last year and predicts that if present trends continue, losses could swell to more than $1bn in 2010. James Buckley, senior analyst at Lafferty's World Cards Intelligence, said there was a striking contrast between China and other fast-growing markets such as Mexico, where it estimates banks made profits from credit cards of about $1.5bn last year.