He was speaking at the launch of HSBC India’s upgraded lifestyle credit card ‘HSBC Live+’. Visa is the network partner of HSBC India for the upgraded card.
The RBI in November last year hiked the risk weight on banks’ credit card receivables from 125% to 150%.
Domestic credit card spends, via both the online and offline routes, continue to grow at more than 20% despite the Reserve Bank of India (RBI)’s hike in risk weights on unsecured credit, including credit cards, Sandeep Ghosh, Visa group country manager for India and South Asia, said on Friday.
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“Regulatory actions around how much capital banks need to set aside for unsecured book have not necessarily impacted either the spending behaviour on cards or what the repayment history is,” Ghosh said. “Credit card spends continue growing well north of 20% both in online and offline environment.”
The RBI in November last year hiked the risk weight on banks’ credit card receivables from 125% to 150%. Ghosh said while credit card spending was lower during Covid-19 due to business and travel restrictions, it revived after the pandemic.
According to RBI’s data, as on May 31, the total number of outstanding credit cards stood at 103.3 million, reflecting a 9% year-on-year rise. Total spending increased 17% YoY to Rs 1.65 trillion in May.
“Credit card, thanks to a few RBI’s interventions, is one of the safest ways to pay as you have dispute redressal mechanism. If a fraud is committed, there is proper infrastructure and rules between banks and networks on how to address that,” Ghosh said.
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He was speaking at the launch of HSBC India’s upgraded lifestyle credit card ‘HSBC Live+’. Visa is the network partner of HSBC India for the upgraded card.
Sandeep Batra, head of wealth and personal banking at HSBC India, said while the bank is very selective in picking credit card customers, data from Aadhar card, credit bureau and the overall open banking infrastructure have made it possible for lenders to approve cards within minutes.
“There are times when you need to exercise caution,” he said on the RBI’s move to hike risk weights on unsecured credit. “But our focus is to profile people properly, serve and educate them properly. I think financial education is a very important part of our concept.”
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HSBC India reported a total of 6.82 lakh outstanding credit cards as on May 2024, and overall spending of Rs 912.47 crore during the month.
