The Reserve Bank of India (RBI) has directed both banks and non-bank lenders to offer credit, debit, and prepaid cards across multiple networks, granting customers the flexibility to make their own choices.
In a draft circular soliciting feedback, the RBI noted that the existing arrangements between card networks and issuers are limiting customers' options. Currently, banks and non-banks typically assign a specific provider, such as American Express, Diners Club International, Mastercard, Visa, or RuPay, when issuing cards.
According to the circular, card issuers are now mandated to provide cards across more than one network. Additionally, financial institutions must allow eligible customers to select from the various card networks available in the country. This choice can be exercised either during card issuance or at a later stage.
These new guidelines are set to come into effect on October 1, and stakeholders have been invited to provide feedback by August 4.
Furthermore, the RBI emphasized that card issuers should not enter into any agreements that restrict them from utilizing services offered by other card networks.
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