The Reserve Bank of India (RBI) on Wednesday (March 6) introduced new guidelines aimed at providing more options and flexibility for credit card customers. The central bank said card issuers must allow eligible customers to choose from multiple card networks at the time of card issuance.
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The RBI specified that card issuers are not allowed to enter into any agreements with card networks that restrict them from accessing services offered by other card networks.
This directive is a response to the RBI's observation that existing arrangements between card networks and issuers were limiting options for customers.
The latest guideline also extends this choice to existing cardholders, allowing them to exercise this option at the time of their next card renewal.
The RBI, through these directives, aims to create an environment where customers have more say in the selection and usage of credit cards.
Card issuers and card networks are mandated to adhere to the new requirements in both existing agreements at the time of amendment or renewal and in fresh agreements executed, the RBI said.
To ensure clarity, the RBI defined authorised card networks as American Express Banking Corp, Diners Club International, MasterCard Asia/Pacific, National Payments Corporation of India–Rupay, and Visa Worldwide.
However, the RBI clarified that these directives do not apply to credit card issuers with fewer than 10 lakh active cards.
Additionally, issuers who issue credit cards on their own authorised card network are exempt from the circular's applicability.
Notably, these rules were supposed to be in force since October 2023 but now RBI has given players six months' additional time because some players were not following directions.
(Edited by : Amrita)
First Published: Mar 6, 2024 9:53 AM IST
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