SBI considers premium credit card cake as Citi, Amex stumble











There is a land grab in the premium credit card space in India.

And the company behind it is India’s largest public sector bank, the State Bank of India (SBI), a bank best known for reaching out to the masses.

Premium credit cards are characterized by a higher level of card spending, an average of Rs 60,000 to 80,000 ($ 797 to $ 1,063) in monthly spending. Mass offers do not exceed Rs 15,000 ($ 199) in monthly card spend, industry executives say The Ken speak with. With India’s leading premium credit card issuers, American Express (Amex) and Citibank, caught in the doldrums, there is a vacuum in the market.

Amex is in trouble with the Reserve Bank of India (RBI). In April 2021, India’s central bank and regulator announced that they would

restrict


restrict

Bloomberg
RBI blocks Amex and Diners Club from adding new customers
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Amex and its fellow premium card issuer Diners Club to issue new cards. The ruling stems from companies’ failure to meet data storage requirements – the RBI requires all payment companies to store data on Indian users in India. While restrictions on Diners were lifted last month, Amex still remains under embargo.

Citibank, on the other hand, is

draw an exit


draw an exit

The Ken
Citi says goodbye
Read more


from the Indian market. “Citibank had a very good base and some of the best [High Net Worth Individuals (HNIs)] were with Citibank. But then their customer acquisition criteria were probably too stringent, ”said a former executive at SBI Cards & Payment Services Ltd. The Ken.

SBI card


SBI card

The Ken
After IPO, SBI Cards Learns What RBI Gives, She Takes
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, SBI’s credit card division, did not respond to a series of questions emailed by The Ken.

They added that while the strict requirements regarding factors such as clients’ income and net worth helped Citi build a good foundation, its refusal to be more flexible with its requirements also made it more difficult for them to stand. develop. “This is the only reason they failed in India,” they added. The former executive and others cited in the article requested anonymity as they were not authorized to speak to the media.

While regulatory issues are part of Amex’s stumble, its core business in India – offering employer-issued commercial cards to employees for company spending – has also declined. A former Amex executive said The Ken that large IT service companies have shifted their business from commercial cards to HDFC, ICICI and HSBC.

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