The RBI has set new rules for credit card issuing banks providing relief to credit card users in India. As per the new guidelines RBI has asked banks not to charge excessive interest rates on personal loans or credit cards. It had clarified earlier that “the total cost to the borrower, including interest and all other charges levied on a loan, should be justifiable having regard to the total cost incurred by the bank in extending the loan.”
Banks have also been asked to provide reasons in writing in case a credit card application has been rejected. In case of unsolicited card the RBI will hold the banks responsible for any liabilities resulting from the misuse of such credit cards. Banks will have to reverse the charge and also pay a penalty to the consumer in case there is any misuse of such credit cards.
Credit Card users in India have something to cheer about; the National Consumer Disputes Redressal Commission has ruled that banks charging interest rates in excess of 30% per annum is an unfair trade practice.
Most banks in India charge between 35%-40% depending on your credit history and the offer you have signed up for. In developed countries like the US the rate of interest is 12%-15% . This is mainly because of the high default rates in countries like India and risk factors associated with it. In developed countries consumers are rewarded with cheaper interest rates for prompt payments which are also not followed by banks in India.
Consumers in India have always had to pay what the banks demand, this new ruling looks like a step in the right direction finally.
ICICI Bank has launched its latest premium credit card “Platinum Identity Credit Card” Visa. It offers a comprehensive list of features combining Shopping, Travel and Golf privileges. The credit card is targeted at high net worth individuals.
The card offers privileges like accelerated rewards program, exclusive rewards catalogue, a powerful air mile conversion option and travel benefits which include Rs 1 crore air accident insurance and complete fuel surcharge waiver across pumps. There is also a full-fledged concierge service, ‘i-Assist’ to address the lifestyle needs of the cardholders.
The Platinum Identity Credit Card offers the following features:
- Welcome privileges - Golf Fee Card with two year membership and Priority Pass
- Accelerated rewards earn – double reward points on international spends, fast-forward earning through the powerful Xpress Rewards program
- Exclusive rewards redemption catalogue ‘Hand-picked Rewards’ featuring premium brands
- Superior air mile conversion program – Convert your reward points into air miles
- Comprehensive air accident insurance of Rs. 1 crore
- Complete waiver of fuel surcharge
- ‘Specials’ -Exclusive offers in lifestyle categories
- ‘i-Assist’ - A round-the-clock, complimentary service that provides assistance with travel and restaurant reservations, gift arrangements, event tickets, and more.
Delhi Metro and Citibank India have launched a credit card on the lines of Airline credit cards which offer miles as rewards. The new co-branded credit card will be act as a multipurpose card that not only operates as a credit card but also operates as an access card to gain entry to the metro train station.
The ‘2 in 1 transit credit card’ is a first of its kind in India and offers many exciting privileges to the Delhi Metro users. Some of the features include discounts of travel fares on Delhi Metro, 2 reward points for every Rs.100 spent on Delhi Metro and 1 reward point for every Rs.100 spent anywhere else. The reward points are convertible into Delhi Metro miles which can be exchanged for free rides on the Metro. The credit card also offers 5 free add on cards so the entire family can use it.
Earlier a press release from Indian Bank’s Association had mentioned that they are working on a proposal to launch a payment gateway called “IndiaPay” and now the RBI says it launching a credit card called “IndiaPay”. Are these connected in anyway? They probably are.
The new credit card to be launched by the end of 2009 will be available to the Indian consumer at lower interest rates and risk reduction capabilities. The idea is to increase the use of plastic money among Indians. A similar approach by the Chinese government called “Union Pay” has been successful since it launch in 2002.
If these credit cards are available at lower interest rates, is it possible that banks will also lower their high interest rates to match it? Credit card users in India pay a higher interest rate compared to most countries in the world. This credit card should come as some relief hopefully.
ABN Amro and MakeMytrip.com have launched a co-branded credit card for India called the “Go Card”. The credit card offers excusive travel rewards from MakeMyTrip. The Go Card is a Titanium MasterCard targeted at the high end traveler. As a special limited time offer they are also offering Free Air Tickets to new members provided they meet a minimum purchase requirement. The card comes free with no joining or annual fee.
Identity theft in India you ask? Well, it may not be something that we hear everyday but with more Indian’s using credit cards and online banking this is no longer a threat we can afford to ignore. Over 10 million Americans have fallen prey to Identity Theft already with a total loss in excess of $50 billion.
So what is Identity Theft?
If a person obtains your personal or financial information with the purpose of committing fraud it is called Identity Theft. Thieves usually use your personal information to represent you falsely and apply for credit cards or bank accounts. Even before you know your information could have been used to apply for loans or borrow funds that you may end up being liable for. The reason why it takes time is because we often fail to review our credit card or bank statements thoroughly.
How is Identity Stolen?
Your trash bin is a gold mine of personal information. Thieves often go through trash to recover old telephone bills, credit card statements, bank statements or junk mail that may have personal information.
Stealing or pick pocketing this is a plain and straight forward approach that thieves could use to get access to your vital financial information.
Phishing, this is where it gets hi-tech. You often get spam e-mails that look like it was sent from your bank. They make it look so real that you would be fooled into thinking it was genuine. They ask for your personal information and before you know thieves have access to your bank account.
It could even happen at a gas station or a restaurant where you hand over your credit card to an unreliable employee who can copy and misuse your credit card information.
So what do thieves do with your identity?
New age thieves can cause a lot of damage with your stolen identity. They can open new credit card accounts and not pay the bills. They can open new bank accounts under your name, apply for loans, or they could simply call the bank and request for a change of address and ask them to mail you a new credit card. There is no limit to what they can do with your information.
So how do you protect yourself from identity theft?
It always pays to be careful with how you handle your personal information. Awareness is your biggest weapon against this crime. Be aware and know how to detect if you have become a victim of identity theft. Here are some steps to safeguard your identity:
Shred old telephone, credit card, bank statements or any financial document that you wish to throw away
Never click on suspicious looking links in your email
Change your computer/online password regularly and make it difficult to guess
Protect your wallet; do not store PIN numbers with your credit cards/ATM cards. Call the bank and report it stolen immediately to avoid any liabilities.
Do not give your financial information over phone to suspicious telemarketers. Offer to call them back at the bank before disclosing any financial information.
Do not share your PIN numbers with anyone.
These are just some tips; there is a lot that you can do to avoid being a victim. The important thing to do is to be aware and be in control of your identity.
The RBI today announced that it is working on formulating a plan to develop a mobile payment system. In other words, it means using your mobile as a credit card. The theory behind this thought is that there are 250 million mobile phone subscribers in India and growing rapidly, whereas there are only 10 million credit card users in India. The idea is to have more people use mobiles as a banking option.
The whole idea behind this initiative is to provide easy access to users where they can use their mobile phone to make purchases. I am not sure how they plan to implement this. Credit card applications are screened and filtered before being approved as being credit worthy, how are they going to screen mobile phone users? Based on their last statement? I can understand if existing credit card users are able to use their mobile phones as another medium to perform a transaction but converting a mobile phone user into a credit card user?
Using your mobile to carry out banking operations is fine since you do not need any credit worthiness to do that, but providing credit facility on the same will be interesting to watch.
Like I said, this is still on paper and a lot of thought needs to go into it. How safe is this going to be? More people loose mobile phones than they loose credit cards, is this going to be secure enough?
TimesofMoney, a Times Group Company today launched an entertainment card in collaboration with Barclays Bank. The co-branded credit card “Times Card from Barclaycard and TimesofMoney” is targeted at the creamy layer who tend to spend a lot on their credit cards.
This is a lifestyle card targeted at individuals who maybe interested in attending Femina fashion shows, celebrity parties, Filmfare award ceremonies, movie premiers and more.
As reported earlier in my blog Kotak Bank had plans to launch their credit card business by March. Kotak has finally announced the launch of its credit card business in April by releasing four new credit cards.
Kotak’s credit cards include Trump and Fortune Visa Gold Credit Cards, League Visa Platinum card and Royale Visa signature credit card. Despite its late entry into the booming credit card industry, Kotak is confident it will make it to the top five credit card retailers list in three years by issuing over 15 lakh credit cards.
The two gold credit cards will be free for life with no entry fee or annual fee. The other two credit cards will have a one time joining fee.
Various schemes like 3 months interest free EMI’s 10% cash back on movie tickets and restaurant bills and auto encashment of reward points are part of the package.
The RBI today announced that it is working on formulating a plan to develop a mobile payment system. In other words, it means using your mobile as a credit card. The theory behind this thought is that there are 250 million mobile phone subscribers in India and growing rapidly, whereas there are only 10 million credit card users in India. The idea is to have more people use mobiles as a banking option.
TimesofMoney, a Times Group Company today launched an entertainment card in collaboration with 
