business-northeast-logo

RBI not considering allowing Non-Bank Lenders to issue Credit cards

BNE News Desk


Spread the love

RBI not considering allowing Non-Bank Lenders to issue Credit cards.

Amid speculations that the Reserve Bank of India may allow non-banking financial companies (NBFCs) to issue credit cards, a report published on CNBC TV-18 clarified that the issue is not in consideration as of now.

The "issue is not on the table right now," the report quoted.

Directions issued by RBI on credit cards till April 2022 said that registered NBFCs cannot issue credit cards or similar products without the regulator's approval. Until April, RBI has allowed only two public sector NBFCs to issue credit cards- SBI (State Bank of India) Card and BoB (Bank of Baroda) Card. On April 21, the regulator released a Master Direction on Credit and Debit Cards, a document that consolidates instructions on rules and regulations.

The regulation that was initiated on April 21 stated that without RBI's nod, NBFCs shall not issue debit cards, credit cards, etc. It is now hoped that the central bank may end up entertaining requests from NBFCs to issue their own credit cards.

At present, NBFCs only distribute credit cards of banks with whom they have formal tie-ups.

For example, Bajaj Finance procures credit card customers for clients like RBL Bank and DBS Bank and has over 3 million customers for the same.

It may be mentioned that India's largest non-bank lender by market capitalization has a network of 3,500 branches, relationships with over 1, 40,000 merchants, and a customer base of nearly 60 million.

ALSO READ: Manipur startup helping tea industry with latest technologies

BNE News Desk