IDBI Bank launches debit cum credit card

IDBI Bank today unveiled Magic Card -- a debit card with in-built credit for salary account holders in a bid to improve its CASA ratio to 24 per cent from 20 per cent as of now during the year.

"The card will work as a debit card till the account holder has balance in it but once exhausted, any further withdrawal or expenditure on the card, magic card will act similar to a credit card," IDBI Bank Chairman and Managing Director R M Malla said.

Though, only basic difference between the magic card and a typical credit card is there is no free credit period but at the same time rate of interest will be much lower and linked to bank rate.

The credit limit or overdraft limit will be either two or three times of net salary depending on the rating of the organisation.

However, the facility will be offered only to salary account holders in the bank.

RBI’s First Quarter Review of Monetary Policy

• The Repo and Reverse Repo Rate rose by 50bps to 8% and 7% respectively
• Cash Reserve Ratio has been maintained unchanged at 6%
• Wholesale Price Inflation (WPI) estimate for March 2012 was raised to 7% from 6% with an upward bias
• Bank deposits are projected to grow at 17% and non-food credit is projected to reduce from 19% to 18%
• Projection for GDP growth is maintained at 8%

HDFC Bank to offer more credit cards to non-account holders

In a shift from its traditional practice of offering credit cards to its captive clients, HDFC Bank, India’s second-largest private sector lender, is now offering more cards to people outside its existing client base.

Currently, customers outside the bank’s existing client base account for 25 per cent of its card base, compared with 10 per cent a year ago.

According to Pralay Mondal, country head (retail assets and credit cards), the move is in line with the bank’s strategy to enter the high-end cards segment. “As we go to super-premium clients, we would look more for external customers. We have already made a shift. While the ratio earlier stood at 90:10, about 25 per cent of our business (in credit cards) now comes from our external clients,” Mondal said during an interaction with Business Standard. With a book value of close to Rs 6,000 crore, HDFC Bank accounts for nearly 30 per cent in the credit card business in India, with the number of cards at 5.5-6 million. “We are issuing close to 85,000 to 90,000 cards a month, and with some new launches, we expect the monthly issuance to cross 100,000 cards soon,” Mondal said.

Speaking about the Infinia high-end credit cards, which the bank launched last month, Mondal said the response has, so far, been good and the bank now plans to introduce a few cards a couple of notches below Infinia to cater to the demand. “We have a cap of 5,000 cards for Infinia, but the demand is for a lot more. That is why we want to come out with variants just below Infinia quickly,” he said.

The lender has seen robust demand for its retail products and has been disbursing Rs 5,000 crore every month, which, it says is the highest in the industry. “We have disbursed loans worth Rs 15,000 crore over the last three months. Each and every product in our retail segment is profit-making. If the total advances in the banking sector grows 17 per cent, retails loans for the industry would grow by around 15 per cent in the current financial year. For HDFC Bank, the growth (in retail loans) would be significantly higher than that,” he said. The bank’s retail book has grown around 30 per cent in 2010-11 and growth in cities, barring that in the top nine ones, contributes nearly half to the bank’s retail assets. Nearly 70 per cent of the bank’s retail loans comprise auto, personal, home, commercial vehicles and two wheeler loans. The bank is slowly beefing up its presence in segments like gold loans, loans against shares and education loans.

Despite seeing aggressive growth in the rising interest rate scenario, the bank is confident of maintaining the rate of growth in retail loans—which is about 50 per cent of its total loan book. The bank also dismissed worries that high rates would translate into a rise in delinquencies in its retail loan portfolio, especially in the unsecured segment.

http://www.business-standard.com/india/news/hdfc-bank-to-offer-more-credit-cards-to-non-account-holders/444573/

HDFC Bank launches premium travel credit cards

The cards come loaded with unique privileges with the USP being their reward point redemption system which gives one the freedom to choose from a wide array of airlines to cash in on the air miles accumulated on the card.

HDFC Bank, the largest credit card issuer in the country, has launched a pack of three premium credit cards that will make air travel for the ultra-rich a walk in the air. With the Global Indian logging thousands of air miles to set his footprint across the world, the formidable trio of Regalia, Superia and Platinum Edge will offer them a complete solution to all their travel needs.  

If Infinia (launched on July 12), our virtually “no-limits” credit card, has redefined the way the rich and the famous live it up, these travel cards will ensure that their flights don’t hit an air pocket. The cards come loaded with unique privileges with the USP being their reward point redemption system which gives one the freedom to choose from a wide array of airlines to cash in on the air miles accumulated on the card. 

HDFC Bank is proud to launch these cards in the IT and travel hub of Bengaluru which boasts of one of the finest airports in India. The city is home to many a frequent traveller and according to the latest Airports Authority of India passenger traffic report, international aircraft movement in Bangalore jumped 10.9% in May 2011 — the highest in India. 

The city was also ahead of the curve in international passenger traffic growth during the period, registering growth of 8.1% compared to the national average of 7.6%. 

Pralay Mondal, Country Head, Retail Assets and Credit Cards, HDFC Bank, said: “HDFC Bank already enjoys the highest mind- and wallet-share in credit cards in India. With this range of products, we have addressed all possible needs that a Global Indian traveller may have. We want to see these travel cards in the wallet of every jet-setter in India.” 

The range of cards will be available on both VISA and MasterCard platforms. The Bank has a credit card base of 50.5 lakh as of March 31, 2011. 

Various products and financial solutions offered by CIBIL

• CIBIL Locate Plus: One of the challenges lenders may face is keeping updated and accurate contact details on all of their customers. CIBIL Locate Plus leverages CIBIL’s vast and comprehensive information repository to provide you with comprehensive contact information on your customers in a faster and more cost effective fashion.
• CIBIL Detect: CIBIL Detect is the first, centralized repository in India on fraudulent activities. This repository is helping banks and financial institutions to share information on potentially high risk customers, minimize frauds thus improving profitability.
• CIBIL Mortgage Check: To address the need for a strong information-sharing network for controlling and containing defaults and fraudulent transactions in the housing finance industry, CIBIL and TransUnion launched CIBIL Mortgage Check which is India’s first repository of mortgage information.  It contains the centralized electronic database on mortgages in India which will help banks and financial institutions to share and access mortgage information, exercise stronger due diligence, and reduce fraudulent transactions.
• Bureau Credit Characteristics (BCC): Bureau Credit Characteristics is a list of predefined characteristics that summarize various aspects of a customer’s credit information. The set comprises 258 credit characteristics which can be used for model development, data analysis, customer profiling, migration analysis and a variety of other account management analyses.
• CIBIL Market Insights: These reports are designed to provide an overview of the credit market basis geographic, demographic and behavioral borrowing trends. By profiling their customer base across various dimensions, benchmarking their performance with the market and identifying their strengths and weaknesses organizations can take proactive corrective decisions and enhance business growth.
• Consumer Credit Information Report (CIR): This is CIBIL’s core offering based on the vast information database pertaining to individual borrowers. Consumer Credit Information Report (CIR) is a vital tool used by credit grantors at the time of new customer acquisitions.
• Portfolio Review Report: Portfolio Review Report is an extremely effective tool for credit grantors to review the risk associated with their existing portfolio of customers. The report provides the credit grantor with a comprehensive view of their borrower’s credit relationships across multiple lenders.
• CIBIL TransUnion Score: The CIBIL TransUnion Score is India’s first generic score and has become the most trusted indicator for prudent decision making by credit grantors. With the CIBIL TransUnion Score, the credit grantor can effectively predict the likelihood of an applicant becoming more than 91 days delinquent on one or more tradelines over the subsequent 12 months.
• CIBIL TransUnion Personal Loan Score: The CIBIL TransUnion Personal Loan Score is the first and only score for the Indian market to predict the likelihood of an applicant or customer becoming more than 91 days delinquent on a personal or consumer loan over the next 12 months. 

Giving out free credit cards not viable: says SBI

Issuance of free credit cards is a risky affair. According to MD and CFO of State Bank of India, Mr Diwakar Gupta, the credit cards should be issued against a fee so that the cardholders only belong to the segment which values the card. "Don't push (free) cards for the sake of increasing numbers," he said.

Female shoppers offer growth in India

Female shoppers in India are becoming increasingly affluent and independent, offering considerable opportunities for brands, a study has argued.

IMRB International, the research firm, surveyed 9,000 women aged at least 25 years old and all drawn from India's major cities. It reported that women in urban India earned an average of 9,457 rupees ($215; €148; £131) per month in 2010, compared with 4,492 rupees in 2001. Largely reflecting this shift, typical household income levels rose from 8,242 rupees to 16,509 rupees during the same period.

Elsewhere, the number of participants possessing a credit card reached 10%, measured against 4% in 2001.

Similarly, the amount of contributors with their own bank account has grown by a third, according to IMRB. In a parallel development, 43% of interviewees are now directly involved in the purchase process, an improvement on 34% in 2001. Across this timeframe, the proportion of females taking almost sole responsibility for doing housework also fell from 91% to 71%.

"With the average income of women and of urban households increasing over the years the propensity to spend has also gone up significantly," Ashish Karnad, group business director, IMRB International, told the Times of India. "Although, there is a strong sense of deriving value for money out of all purchases made, the thought of putting all of the household income into savings is slowly diminishing."

Gopal Vittal, executive director, home and personal care products, for Hindustan Unilever stated the potential benefits of successfully engaging this audience are rapidly increasing. "With rising incomes and education there is a profound impact on consumption. The rates of growth of several discretionary categories are nothing short of dramatic as a result," he said.

It is estimated that a third of India's 480m jobs are filled by women, and many companies are tailoring their approach towards this demographic.

"We have aligned our strategy, communication and products to women," said Kishore Biyani, founder of Future Group, which owns major retail chains such as Pantaloon and Big Bazaar. "With the growing aspirations and financial independence of women not only in urban India but in tier two and tier three cities, women are at the core of our business." "The woman today is buying for herself and for her family.

Tanya Dubash, executive director and president, marketing for Godrej Industries, a conglomerate active in sectors from confectionery to personal care, also championed this idea. "There remain very few areas of consumption in which the female does not increasingly participate today. Most household purchase decisions are either joint or exclusively female," she said. "Like in the West, marketing approaches and brand experiences in India will increasingly need to be designed around these insights."