Indian Credit Card Industry – On the Path of Unbound Growth

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Soon, you will no longer need to carry your plastic money for your payments, as your mobile phone number will serve as a credit card number. In its annual policy statement, the Reserve Bank of India (RBI) recently announced that it was formulating guidelines for a payment system using mobile phones. RBI is in discussion with public and private sector banks, service providers and industry organizations to develop the payment system. RBI stated that the draft guidelines would be placed on its official website by June 15, 2008.

In India, the use of mobile is increasing rapidly. There are around 250 million mobile phone connections in the country, while the number of credit card holders is well below the number of mobile phone users. Therefore, the mobile for payments has been considered for some time as a progressive step forward.

As reported by the Times of India, RBI said in its policy statement "The rapid expansion of this mode of communication and transaction has created a new delivery channel for banks." RBI adds, "This channel will certainly facilitate low-value payments to merchants, utility providers and" likes "and low-cost money transfers."

The credit card market will experience more gradual changes this year. A joint venture between Life Insurance Corporation of India (LIC) and GE Money is expected to launch its first product by the end of 2008. As Business Standard reports, the company is now on cards. But we have solved these problems (conflict of interest). We are currently examining human resource issues. The two financial giants plan to launch the card by the end of the calendar year.

Once the credit card is launched, it will only be available to LIC customers and policyholders the first year. GE Money holds a 30% interest in the card initiative, while Housing Finance Corporation, the Mutual Fund and Bank Corporation each hold 5%. LIC will have 40% in the company, whose capital is about 150 crores of rupees. LIC has yet to make a decision regarding the remaining 15% of the total investment. Another positive development, ABN AMRO and its travel portal in India, MakeMyTrip.com, have launched a separate co-branded credit card, the Go Card® Card. recently. The card offers special benefits and a wide range of travel promotions and packages.


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