Credit Card portability from October 1: RBI draft circular

In its draft circular, RBI mandates card issuers, including banks and non-banks, to issue cards on more than one card network along with providing the facility to customers to choose any one among the multiple card networks.

Image Source: PTI

Soon the card users will have the choice of porting their cards from one network to another. The Reserve Bank of India (RBI) has proposed to allow customers to change their debit, prepaid or credit card networks. The proposal aims to enhance customer choice and promote a more competitive environment in the card network industry.

According to a draft circular released by the RBI (dated July 5), the card issuers will offer cards on more than one card network and provide customers with the option to choose between card networks at the time of issuance and thereafter.

The card network portability option will be included in existing agreements or at the time of renewal or in fresh agreements executed from the date of the circular. 

There are at present, five credit card networks in India – Visa, MasterCard, RuPay, American Express and Diner’s Club. With the RBI proposal coming into effect from October 1, the card users will have the choice of porting their cards from one network to another.

The introduction of customer choice in shifting between card networks is likely to boost competition among network companies.

For example, by offering Unified Payments Interface (UPI) services on credit cards, currently not being offered by other networks, RuPay could gain an advantage.

The draft proposal by the apex bank also restrains card issuers from entering into agreements that restrain their ability to engage with other card networks.

The RBI’s draft circular is open for comments and feedback, till August 4.