Standard Chartered Bank has teamed with Air Sahara to issue a co-branded “VISA Gold” card. The new “Air Sahara Standard Chartered VISA Gold Credit Card” offers one free companion ticket per year or two free tickets for children when travelling with spouse, per year. The card also offers three complimentary upgrades to business class, each year, as well as a 5% discount throughout the year on all Air Sahara tickets purchased with the card. For every Rs. 125/- spend on the card, users will earn 1.5 “Cosmos” miles. Cardholders are automatically enrolled in Air Sahara’s “Cosmos – Power Flier Programme.” The card carries an annual fee of Rs. 3000/-. Standard Chartered Bank and Air Sahara have had a relationship for two years.
ICICI Bank is pushing ahead of its competition, as the issuer adds 150,000 debit cards and 100,000 credit cards each month. ICICI has become the second largest issuer of credit cards in the country with 1.6 million. In the debit card market, ICICI has about 4.0 million cards.
Citibank remains the credit card leader in India with 1.8 million cards, but may be overtaken by ICICI within the next twelve months. The third and fourth largest credit card issuers are Standard Chartered Bank and SBI Cards, respectively. ICICI is reportedly focusing on co-branded cards to fuel its growth. The bank currently has co-branded deals with HPCL, BPL Mobile, and Trinetra.
Outsourcing activity among US financial services companies to offshore areas, such as India, will grow by as much as 20% in the 4th quarter according to a new survey. ICICI OneSource and A.T. Kearney estimated that US banks, brokerage firms, insurance companies, mutual funds and other financial services firms will relocate offshore eight percent of their workforce, representing more than 500,000 jobs, over the next five years. These relocations are expected to reduce annual operating costs by more than $30 billion. ICICI OneSource is one of the largest third-party BPO services companies in India, with offshore facilities in Mumbai and Bangalore and international business development offices in New York and London.
The Life Insurance Corporation of India is reportedly in talks with Capital One to issue a debit card in the country. The insurance concern also fielded proposals from SBI Card and Corporation Bank, but preferred the Capital One proposal. LIC wants to issue a debit card linked up to its insurance policies. However, the firm wants a competitively priced card. According to the Business Standard, LIC has asked for a waiver of joining fees and annual fees for card holders, plus a reduced rate of interest for cash advances. LIC was asking for rates that were as low as 0.9% to 1.0% per month against the existing rates of 1.9% to 2.2% per month.
HDFC Bank and the National Insurance Company have teamed to launch the co-branded “HDFC Bank Health Plus MasterCard Credit Card.” The card is being launched in Mumbai, Delhi and Chennai. The card offers a free and cashless “Mediclaim” of Rs. 50,000 and a critical illness cover of Rs. 1.5 lakh. Critical illnesses covered include: open heart & bypass surgeries, cancer & bone marrow transplants, renal failures & kidney transplants and cerebral & vascular strokes. HDFC Bank is also extending the Mediclaim offer to supplementary cardholders. Furthermore, cardholders have the option of purchasing additional Mediclaim covers at highly discounted rates. The card is priced at Rs 950 per annum. HDFC expects to issue between 15,000-20,000 cards in the first year of the alliance. With this launch, HDFC Bank has expanded its credit card offering which already comprises the HDFC Bank International Silver Credit Card (launched in December 2001), the HDFC Bank International Gold Credit Card (launched in July 2002), and the HDFC Bank Â eSeva International Credit Card (a credit card designed to help citizens fulfill civic obligations, launched in January 2003).
Diebold has appointed a new managing director and has established a new corporate office. The company has named Rajiv Singh as managing director to head up Diebold India Private Ltd. and Diebold Systems Pvt. Ltd. Diebold also announced the establishment of its new corporate office for the Indian sub-continent in Mumbai. Prior to joining Diebold, Singh held the position of managing director of Computer Associates, India, and SAARC countries.
The Reserve Bank of India has issued new rules permitting residents who maintain foreign currency accounts in India to obtain international credit cards issued by financial institutions outside the country. However, restrictions on the use of international credit cards by residents for the purchase of lottery tickets, banned magazines, participation in sweepstakes, and payment for call back services would continue to apply. In January, the RBI lifted its $10,000 annual limit on foreign credit card spending by consumers and its $25,000 for annual restriction on international business travel credit card spending as mandated by the Foreign Exchange Management Act. The RBA says credit card users will now be limited by their credit card credit lines and will no longer need special permission to exceed the annual RBA limits. Under the current RBA rules, the credit limit for a “Classic”/”Silver” credit card is between Rs 15,000-Rs 50,000 (apprx. $300 and $1000); “Gold” card credit limits are now between Rs 50,000-Rs 300,000 (apprx. $1000 and $6000); and, “Platinum” card credit limits begin at Rs 500,000 (apprx. $10,000). India has about six million credit cards and the average annual credit card volume per card of about Rs 17,000 ($350). There are less than 10,000 “Platinum” credit cards in the country.
Four banks are gearing up to launch “Cashnet,” India’s first nationwide shared ATM switch. The Reserve Bank of India recently gave approval to Euronet to operate the switch with the Industrial Development Bank of India as the settlement bank. The founding banks for “Cashnet” are Citibank, IDBI Bank, Standard Chartered Bank and Unit Trust of India Bank. Based on the member banks’ existing ATMs, “Cashnet” will provide access to more than 1,300 ATMs for the more than 6 million debit and credit cardholders of the member banks across more than 100 cities in India. Customers from the member banks can use any ATM in the network. These transactions will be supported by online connections between each bank and the Euronet processing center in Mumbai, thus establishing the first shared ATM network in India to offer end-to-end online transaction processing across the entire network.
Mumbai-based ICICI OneSource reported that its workforce has tripled to
2,175 employees, during the past 12 months. I-OneSource primarily serves
the banking, insurance, asset management, and diversified financial
services markets in the U.S. and U.K. with off-shore back office services.
The company currently handles upwards of 18 million voice and back office
transactions a year. The firm recently received the prestigious “COPC”
certification, becoming the first company in the world to achieve this
rigorous standard for back office processing services.
Diebold has signed an agreement to acquire the remaining equity of a
joint venture formed in 1987 with HMA Data Systems. Diebold HMA Private Ltd
will now be headquartered in Chennai. Diebold has also secured a major
order for advanced function ATMs from Punjab National Bank, which has
signed with Diebold to supply ATMs for its onsite and offsite ATM centers
for 2003. The bank intends to increase its ATM network strength from an
existing 250 units to at least 1,000 ATMs by March 2004. In the first
quarter, Diebold also captured a significant order from UTI Bank in Mumbai
and additional contracts from several other Indian banks which total more
than 900 units.
Mumbai-based State Bank of India has signed an agreement with NCR
to deploy about 1,500 ATMs in the next 18 months. The new ATMs will feature
mobile phone top-ups, utility bill payment, voice guidance for ATM
operations, multilingual screens and a touch screen ATM locator. Under
terms of the deal, NCR will provide hardware, total installation services
and ATM network management services. With this deployment, SBI will have
the largest network in India, with over 3,000 ATMs spanning the length and
breadth of the country.
New Delhi-based Hero Honda Motor Ltd., GE Capital India, and the State Bank of India have teamed to launch a co-branded credit card. The new “Hero Honda SBI VISA Card” will initially be marketed to Hero Honda’s seven million customers. Hero Honda is India’s largest two-wheeler maker with annual sales of 1.7 million units. SBI Cards is a joint venture between SBI and GE Capital. SBI Cards currently has 300,000 classic VISA credit cards issued across 25 cities in India. The card will feature no annual fee for the first year, no transaction fees at IOC and IBP petrol pumps on fuel purchases of over Rs 250, and a one-year road accident insurance of Rs 100,000.