Banks offering lucrative credit card deals to encash festive hype
According to the Reserve Bank of India, the total number of credit cards was at 63.4 million by the end of July
With festive season right around the corner, banks are churning out new credit cards with attractive offers at a time when customers don’t mind going deeper into their pockets, Mint reported on Monday. Though lenders are keeping an eye out on unsecured loans, they are making calculated bets on credit cards at the same time. In a market which is considered as extremely competitive, banks that so far did not offer credit cards are also foraying into this space, apart from market leaders like State Bank of India (SBI) and HDFC Bank.
BNPL a big hit among youth
Last month, Federal bank, a private sector bank based out of Kochi had entered the credit card business by forming an association with Visa. It had also launched another card with RuPay, a homegrown card network, a couple of days later. Their credit cards will be a product for their existing customers, the publication said.
India’s largest private sector bank HDFC Bank on September 29th, had announced that it would revamp three of its existing cards to offer more to customers, as it looks to regain its lost market share in the next three to four quarters. The lender had recently lost its ground, due to the embargo by the Reserve Bank of India (RBI), following glitches in its e-banking services.
The banks has issued over 4,00,000 credit cards till September 21, just about a month after the ban was lifted. According to the publication, the bank reported that newcomers to the workforce and millennials alike are digitally savvy and are a strong target segment for cards.
Many banks have shown enthusiasm at a time, when Buy Now Pay Later (BNPL) products have caught the eyes of customers, especially the youth. It essentially 15 days of interest free funds to small borrowers.
While some see these products as the first step in assessing a borrower’s creditworthiness, others see it as a competitor to credit cards.
According to the Reserve Bank of India, the total number of credit cards was at 63.4 million by the end of July.