Will RuPay repeat its debit card success in the credit card space?

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MUMBAI : The retail payments umbrella entity National Payments Corp. of India (NPCI) aims to develop credit cards on the local RuPay card network to emulate the volumes it has in the debit card space, said Praveena Rai, COO.

“On credit cards, the real push started last year. As we move into the credit card space, this is a base that will grow over time, ”Rai said in an interview after announcing a partnership with the credit card division of Bank of Baroda, BoB Financial Solutions Ltd (BFSL).

At present, there are “a few million” RuPay credit cards in India and 10-15% of new credit cards issued are on the national card network, a sign that acceptance is growing among issuers and providers. consumers, said Rai. NPCI plans to extend its partnerships to all card issuers.

RuPay’s debit cards have received tremendous boost by being associated with the Pradhan Mantri Jan Dhan Yojana (PMJDY) program, India’s flagship financial inclusion program. As of November 10, banks had issued 317.2 million RuPay debit cards to beneficiaries.

“Yeah, there was a big push from Jan Dhan and it gave RuPay a boost in the beginning. We have 1,100 banks in the country that issue RuPay cards, from the largest to the smallest across the segment. The goal of the NPCI has always been to create citizen-level infrastructure and provide citizen-level services. This same philosophy will extend to credit cards, ”said Rai.

RuPay has firmly established itself in the debit card and prepaid card space and is now gaining significant momentum and creating a presence in the credit card space, she said.

“As our issuance and market share increases, a key goal is to have all of the major credit card issuers live on the platform,” said Rai.

Rai said that she does not believe there are any gaps in the RuPay platform when it comes to international use.

“Users must activate their cards for international use. In fact, wherever we find failures, we realize that customer awareness is one of the challenges, ”she said.

To this extent, the combination with BFSL (formerly BoBcards Ltd) gives RuPay access to a company specializing in credit cards, backed by a large public sector bank with a large customer base.

Having entered the Indian credit card market in 1994, four years before the launch of SBI Card, BFSL lagged behind its peers and other lenders in issuing cards.

“We arrived too early. We arrived when there was no Cibil (credit bureau). We were very aggressive when the ecosystem in the Indian context was not prepared for a credit card type product. There was a huge flaw and management took a call to press the pause button, ”said Shailendra Singh, Managing Director and Managing Director of BFSL.

The real push started around 2018, when the base was 125,000 cards and in three years it’s over 700,000 credit cards, Singh said. In two years, BFSL should be among the top 10 credit card issuers, he said.

“If you watch the new shows, we’re in the top five. Over the past two or three years, we’ve invested heavily in technology, internal processes, capacity building and recently integrated the best Vision Plus credit card processing platform. All of this allows us to enter the market more aggressively, ”he added.

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