Yes Bank aims to double credit card customer base in two years

New Delhi: Yes Bank is looking to build a brand around its credit card business and aiming to double its customer base in the segment in the next two years, the head of its credit card business said.

Also, the bank is targeting a four-fold rise in its book value over the next two years. “Overall credit card spends (of the industry) are back to pre-Covid levels. Some banks say 80-90%, for some it is 90%, my gut feeling is that most of this is back to normal. Some of the sectors are still slow, especially when it comes to tour and travel, where there is a recovery of about 25-30%,” said Rajanish Prabhu, Head – Credit Cards and Merchant Acquisition, Yes Bank.

“For eating places and hotels, the recovery is still less but when you look at grocery stores, super markets or utility payments and the electronic stores, you see a lot of lift there,” he said. Overall, the industry is looking back on its feet and within that e-commerce has seen a good jump and has really changed a shift on online penetration, Prabhu added.

“Our own vision is to make sure that we grow our book by at least four times in the next two years or say 15 times in the next five years. We will double our customer base in the next two years. “But as we do that we will also make sure that we get the HNW (high net worth) and the super HNW customers also. You want the high net worth customers but you also want the mass base customers because today everybody uses credit card. We want to attract every segment of customers,” Prabhu said.

Yes Bank’s outstanding credit card at the end of September 2020 stood at 8,16,208, with value of transactions standing at Rs 490.76 crore, according to RBI data.

“From a credit card industry perspective, the spends are back. But there is one thing that we are comparing November with February, but what still needs to happen is that year-on-year growth also has to come back in the same manner.” Because of the pandemic, people had no choice but to go online, which has helped get a lot of traction and these spends are not only coming from tier I and tier II cities but they are also coming from tier III, IV and V cities.

“I think credit card as a culture, overall with or without the pandemic, keeps on improving. If I have to give you the perspective, today credit card spend to GPD is about 2.5-3%, if you take it six or seven years away from the current time that number will go to about 6.5-7%, this is RBI estimate. Developed countries number is far higher. So as more and more people enter into the working class, the white collar segment, …there is a cultural shift happening, there is demographic shift happening, I think people will get more and more comfortable using credit cards,” Prabhu said.

He said the bank will invest in technology as well as distribution besides forging more partnerships with merchants and others.

To tap the opportunity amidst the pandemic, the bank recently launched ‘Yes Private Prime’ credit card, targeting the affluent and HNI customers.