The largest private bank in India, HDFC Bank Ltd., wants to issue one million credit cards per month, marking a stunning turnaround for the institution after the country’s regulator forbade it from accepting new card customers two years ago.
According to Parag Rao, country head for payments business, consumer finance, digital banking, and marketing, the bank plans to treble the current pace of 500,000 new credit card issuances per month. In order to boost card usage, the company will announce collaborations in a variety of sectors, including online shopping and food delivery, Rao added.
Since the eight-month card ban was removed in August of last year, HDFC Bank has recovered quickly as it attempts to put its recurrent online errors that injured its customers behind it. According to figures from the Reserve Bank of India, the bank had the greatest share of total credit card expenditure in India in October at 29%.
In an interview, Rao said, “We focus on deep engagement, ensuring users discover more value in their cards, and keeping spending. We don’t just focus on the issue of cards, which is a distribution game.
Two airlines and a significant hotel chain are also joining forces in the coming weeks, according to Rao. He stated that HDFC Bank is nearing completion on the creation of a new digital credit card to attract younger clients.
Banks in the second-most populous nation in the world stand to gain from the rise of internet shopping, where clients frequently pay with credit cards. According to a Bain & Co Inc. research, between 200 million and 300 million Indians are anticipated to spend $50 billion on online retail this year.
Rao stated that the combination of HDFC Bank and Housing Development Finance Corp., which will grant it access to the mortgage lender’s clients, will be a key component of the bank’s effort. To capitalise on an increase in home loans and consumer spending in India, the two businesses decided to merge this year in one of the largest global mergers.
In addition to partnerships, the bank seeks to entice additional credit card users from RuPay, a domestic retail payment system in India. He believes that the market for these cards will grow as a result of recent regulations that permit the connection of RuPay credit cards to the extensively utilised government-backed payment interface.
Although these consumers’ credit lines will be limited, Rao predicted that they will be future customers who can upgrade to other cards as their needs change.
And although competitors are using rewards on a wide range of products to attract customers, HDFC Bank is staying away from this tactic.
Rao stated, “Neither do we want to be regarded as the card with the most discounts; nor have we ever had the best discounts on the market.
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