Lok Sabha Question No. 3485 (UNSTARRED), answered on 2019-07-15
Subject: Credit Card Companies
Ministry: FINANCE
Asked by: Parbatbhai Savabhai Patel, Naranbhai Bhikhabhai Kachhadiya

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF FINANCIAL SERVICES

## LOK SABHA UNSTARRED QUESTION NO. 3485

ANSWERED ON MONDAY, JULY 15, 2019/ ASHADHA 24, 1941 (SAKA)

## CREDIT CARD COMPANIES

## 3485. SHRI PARBATBHAI SAVABHAI PATEL: SHRI NARANBHAI KACHHADIYA:

Will the Minister of FINANCE be pleased to state:

- (a) the number of companies/banks which are providing credit card facility along with the number of credit card holders at present in the country;
- (b) the number of credit card holders added during each of the last three years and the current year, along with the rate of interest charged by the companies/banks from the payment defaulters during the said period, company/bank-wise;
- (c) whether the Government is aware that due to non-regulation of rate of interest charged by credit card companies/banks, they are charging high rate of interest per annum; and
- (d) if so, the details thereof and the corrective steps taken by the Government to address the issue ?

## Answer

## THE MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI ANURAG SINGH THAKUR)

- (a)  to  (b):  The  Reserve  Bank  of  India  (RBI)  has  informed  that  as  on  31.03.2019,  34 Scheduled  Commercial  Banks  have  issued  48,920,802  credit  cards.  The  number  of credit  cards  increased  /  decreased  during  the  years  2016-17,  2017-18,  2018-19  and 2019-20 is given in Annex. Further, RBI has deregulated the interest rate on advances sanctioned  by  Scheduled  Commercial  Banks  (excluding  Regional  Rural  Banks)  with effect from 18.10.1994 and interest rates are determined by banks with approval of their respective  Board  of  Directors  subject  to  regulatory  guidelines  on  interest  rate  on advances contained in RBI's Master Direction dated 03.03.2016.
- (c) to (d): In terms of Para 5.1 of Part I of RBI's Master Circular on 'Credit Card, Debit Card  and  Rupee  Denominated  Co-branded  Pre-paid  Card  Operations  of  Banks  and Credit  card  issuing  Non  Banking  Finance  Companies  (NBFCs)'  dated  01.07.2015, banks are advised to:
-  be guided by the instructions on interest rate on advances issued by RBI and as amended  from  time  to  time,  while  determining  the  interest  rate  on  credit  card dues, the latter being in the nature of non-priority sector personal loans.
-  prescribe  a  ceiling  rate  of  interest,  including  processing  and  other  charges,  in respect of credit cards. In case banks/ NBFCs charge interest rates which vary based  on  the  payment/  default  history  of  the  cardholder,  there  should  be transparency in levying of such differential interest rates. In other words, the fact that higher interest rates are being charged to the cardholder on account of his payment/  default  history  should  be  made  known  to  the  cardholder.  For  this purpose, the banks should publicise through their website and other means, the

interest rates charged to various categories of customers. Banks/NBFCs should upfront  indicate  to  the  credit  card  holder,  the  methodology  of  calculation  of finance charges.

-  Further, in terms of Para 5.2(b) of the above stated Master Circular, card issuers should quote  Annualized  Percentage  Rates  (APR)  on  card  products  (separately  for  retail purchase and for cash advance, if different). The method of calculation of APR should be given with a couple of examples for better comprehension. The APR charged and the  annual  fee  should  be  shown  with  equal  prominence.  The  late  payment  charges, including the method of calculation of such charges and the number of days, should be prominently  indicated.  The  manner  in  which  the  outstanding  unpaid  amount  will  be included for calculation of interest should also be specifically shown with prominence in all  monthly  statements.  Even  where  the  minimum  amount  indicated  to  keep  the  card valid  has  been  paid,  it  should  be  indicated  in  bold  letters  that  the  interest  will  be charged  on  the  amount  due  after  the  due  date  of  payment.  These  aspects  may  be shown  in  the  Welcome  Kit  in  addition  to  being  shown  in  the  monthly  statement.  A legend/notice to the effect that 'Making only the minimum payment every month would result in the repayment stretching over years with consequent interest payment on your outstanding balance" should be prominently displayed in all the monthly statements so as to caution the customers about the pitfalls in paying only the minimum amount due.

In terms of Para 5.2(c) of the above stated Master Circular, banks/NBFCs should step up  their  efforts  on  educating  the  cardholders  of  the  implications  of  paying  only  'the minimum amount due'. The 'Most Important Terms and Conditions' should specifically explain that the 'free credit period' is lost if any balance of the previous month's bill is outstanding. For this purpose, banks/NBFCs could work out illustrative examples and include the same in the Welcome Kit sent to the cardholders as also place it on their website.

|                                                                                                 |                                                                                                 |                                                                                                 |                                                                                                 |                                                                                                 |                                                                                                 |                                                                                                 |                                                                              |                                                                              |                                                                              | Annex             |
|-------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------|------------------------------------------------------------------------------|------------------------------------------------------------------------------|-------------------|
| Table: Scheduled Commercial Banks (SCBs) issuing credit cards and number of credit cards issued | Table: Scheduled Commercial Banks (SCBs) issuing credit cards and number of credit cards issued | Table: Scheduled Commercial Banks (SCBs) issuing credit cards and number of credit cards issued | Table: Scheduled Commercial Banks (SCBs) issuing credit cards and number of credit cards issued | Table: Scheduled Commercial Banks (SCBs) issuing credit cards and number of credit cards issued | Table: Scheduled Commercial Banks (SCBs) issuing credit cards and number of credit cards issued | Table: Scheduled Commercial Banks (SCBs) issuing credit cards and number of credit cards issued | these banks - As on                                                          | these banks - As on                                                          | these banks - As on                                                          |                   |
| Sr No                                                                                           | Bank Name                                                                                       | March 31, 2016                                                                                  | March 31, 2017                                                                                  | March 31, 2016                                                                                  | March 31, 2016                                                                                  | May 31, 2019                                                                                    | Credit Cards 2016-17                                                         | Increased/Decreased 2017-18                                                  | during 2018-19                                                               | the year 2019-20@ |
|                                                                                                 | 1 AMERICAN EXPRESS BANKING CORPORATION                                                          | 837,960                                                                                         | 1,005,961                                                                                       | March 31, 2018 1,184,218                                                                        | March 31, 2019 1,461,191                                                                        | 1,513,437                                                                                       | 168,001                                                                      | 178,257                                                                      | 276,973                                                                      | 52,246            |
|                                                                                                 | 2 ANDHRA BANK                                                                                   | 149,050                                                                                         | 168,394                                                                                         | 234,555                                                                                         | 301,234                                                                                         | 303,397                                                                                         | 19,344                                                                       | 66,161                                                                       | 66,679                                                                       | 2,163             |
|                                                                                                 | 3 AXIS BANK LTD                                                                                 | 2,413,568                                                                                       | 3,346,735                                                                                       | 4,486,394                                                                                       | 5,959,857                                                                                       | 6,170,677                                                                                       | 933,167                                                                      | 1,139,659                                                                    | 1,473,463                                                                    | 210,820           |
|                                                                                                 | 4 BANK OF AMERICA                                                                               | 5,901                                                                                           | 12,076                                                                                          | 17,896                                                                                          | 23,038                                                                                          | 23,797                                                                                          | 6,175                                                                        | 5,820                                                                        | 5,142                                                                        | 759               |
|                                                                                                 | 5 BANK OF BARODA                                                                                | 113,554                                                                                         | 131,571                                                                                         | 125,563                                                                                         | 231,277                                                                                         | 324,275                                                                                         | 18,017                                                                       | -6,008                                                                       | 105,714                                                                      | 92,998            |
|                                                                                                 | 6 BANK OF INDIA                                                                                 | 145,084                                                                                         | 145,860                                                                                         | 208,810                                                                                         | 184,276                                                                                         | 185,605                                                                                         | 776                                                                          | 62,950                                                                       | -24,534                                                                      | 1,329             |
|                                                                                                 | 7 BANK OF MAHARASHTRA                                                                           | 50,090                                                                                          | -                                                                                               | -                                                                                               | -                                                                                               | -                                                                                               | -50,090                                                                      | -                                                                            | -                                                                            | -                 |
|                                                                                                 | 8 CANARA BANK                                                                                   | 200,416                                                                                         | 215,250                                                                                         | 223,286                                                                                         | 369,339                                                                                         | 381,745                                                                                         | 14,834                                                                       | 8,036                                                                        | 146,053                                                                      | 12,406            |
|                                                                                                 | 9 CENTRAL BANK OF INDIA                                                                         | 114,446                                                                                         | 106,515                                                                                         | 102,514                                                                                         | 92,838                                                                                          | 92,317                                                                                          | -7,931                                                                       | -4,001                                                                       | -9,676                                                                       | -521              |
|                                                                                                 | 10 CITI BANK                                                                                    | 2,397,114                                                                                       | 2,525,548                                                                                       | 2,671,617                                                                                       | 2,710,776                                                                                       | 2,714,145                                                                                       | 128,434                                                                      | 146,069                                                                      | 39,159                                                                       | 3,369             |
|                                                                                                 | 11 CITY UNION BANK                                                                              | -                                                                                               | 626                                                                                             | 5,018                                                                                           | 6,701                                                                                           | 6,762                                                                                           | 626                                                                          | 4,392                                                                        | 1,683                                                                        | 61                |
|                                                                                                 | 12 CORPORATION BANK                                                                             | 80,381                                                                                          | 96,332                                                                                          | 105,878                                                                                         | 110,594                                                                                         | 111,173                                                                                         | 15,951                                                                       | 9,546                                                                        | 4,716                                                                        | 579               |
|                                                                                                 | 13 DCB BANK LTD                                                                                 |                                                                                                 | 6,464                                                                                           | 28,610                                                                                          | 85,477                                                                                          | 100,273                                                                                         | 6,464                                                                        | 22,146                                                                       | 56,867                                                                       | 14,796            |
|                                                                                                 | 14 DHANALAKSHMI BANK LTD                                                                        | 6,870                                                                                           | 7,487                                                                                           | 7,597                                                                                           | 6,613                                                                                           | 6,582                                                                                           | 617                                                                          | 110                                                                          | -984                                                                         | -31               |
|                                                                                                 | 15 HDFC BANK LTD                                                                                | 7,281,693                                                                                       | 8,544,721                                                                                       | 10,686,376                                                                                      | 12,486,918                                                                                      | 12,679,846                                                                                      | 1,263,028                                                                    | 2,141,655                                                                    | 1,800,542                                                                    | 192,928           |
|                                                                                                 | 16 HONGKONG AND SHANGHAI BKG CORPN                                                              | 474,164                                                                                         | 440,923                                                                                         | 578,514                                                                                         | 735,385                                                                                         | 761,827                                                                                         | -33,241                                                                      | 137,591                                                                      | 156,871                                                                      | 26,442            |
|                                                                                                 | 17 ICICI BANK LTD                                                                               | 3,653,052                                                                                       | 4,253,992                                                                                       | 4,997,535                                                                                       | 6,645,716                                                                                       | 7,013,846                                                                                       | 600,940                                                                      | 743,543                                                                      | 1,648,181                                                                    | 368,130           |
|                                                                                                 | 18 IDBI LTD                                                                                     | 6,905                                                                                           | 21,510                                                                                          | 27,025                                                                                          | 33,034                                                                                          | 33,317                                                                                          | 14,605                                                                       | 5,515                                                                        | 6,009                                                                        | 283               |
|                                                                                                 | 19 INDIAN BANK                                                                                  | 73,106                                                                                          | 80,229                                                                                          | 86,411                                                                                          | 87,320                                                                                          | 87,772                                                                                          | 7,123                                                                        | 6,182                                                                        | 909                                                                          | 452               |
|                                                                                                 | 20 INDIAN OVERSEAS BANK                                                                         | 41,873                                                                                          | 43,322                                                                                          | 53,172                                                                                          | 58,033                                                                                          | 58,364                                                                                          | 1,449                                                                        | 9,850                                                                        | 4,861                                                                        | 331               |
|                                                                                                 | 21 INDUSIND BANK LTD                                                                            | 440,527                                                                                         | 582,848                                                                                         | 781,486                                                                                         | 1,062,264                                                                                       | 1,124,701                                                                                       | 142,321                                                                      | 198,638                                                                      | 280,778                                                                      | 62,437            |
|                                                                                                 | 22 JAMMU AND KASHMIR BANK                                                                       | 45,906                                                                                          | 457,214                                                                                         | 127,772                                                                                         | 139,657                                                                                         | 141,126                                                                                         | 411,308                                                                      | -329,442                                                                     | 11,885                                                                       | 1,469             |
|                                                                                                 | 23 KARUR VYSYA BANK LTD                                                                         | -                                                                                               | -                                                                                               | -                                                                                               | 1,118                                                                                           | 1,926                                                                                           | -                                                                            | -                                                                            | 1,118                                                                        | 808               |
|                                                                                                 | 24 KOTAK MAHINDRA BANK LTD                                                                      | 727,207                                                                                         | 1,044,402                                                                                       | 1,462,480                                                                                       | 2,002,733                                                                                       | 2,093,315                                                                                       | 317,195                                                                      | 418,078                                                                      | 540,253                                                                      | 90,582            |
|                                                                                                 | 25 PUNJAB NATIONAL BANK                                                                         | 194,370                                                                                         | 253,951                                                                                         | 319,641                                                                                         | 334,113                                                                                         | 355,448                                                                                         | 59,581                                                                       | 65,690                                                                       | 14,472                                                                       | 21,335            |
|                                                                                                 | 26 RATNAKAR BANK LIMITED                                                                        | 149,820                                                                                         | 281,236                                                                                         | 799,962                                                                                         | 1,715,101                                                                                       | 1,924,849                                                                                       | 131,416                                                                      | 518,726                                                                      | 915,139                                                                      | 209,748           |
|                                                                                                 | 27 STANDARD CHARTERED BANK LTD                                                                  | 1,010,712                                                                                       | 1,092,615                                                                                       | 1,253,784                                                                                       | 1,290,826                                                                                       | 1,305,087                                                                                       | 81,903                                                                       | 161,169                                                                      | 37,042                                                                       | 14,261            |
|                                                                                                 | 28 STATE BANK OF INDIA                                                                          | 3,620,042                                                                                       | 4,569,048                                                                                       | 6,258,360                                                                                       | 8,271,446                                                                                       | 8,734,604                                                                                       | 949,006                                                                      | 1,689,312                                                                    | 2,013,086                                                                    | 463,158           |
|                                                                                                 | 29 SYNDICATE BANK                                                                               | 71,735                                                                                          | 73,858                                                                                          | 84,339                                                                                          | 45,722                                                                                          | 45,690                                                                                          | 2,123                                                                        | 10,481                                                                       | -38,617                                                                      | -32               |
|                                                                                                 | 30 TAMILNAD MERCANTILE BANK LTD                                                                 | 7,369                                                                                           | 7,966                                                                                           | 20,125                                                                                          | 18,465                                                                                          | 19,018                                                                                          | 597                                                                          | 12,159                                                                       | -1,660                                                                       | 553               |
|                                                                                                 | 31 UNION BANK OF INDIA                                                                          | 142,221                                                                                         | 182,914                                                                                         | 218,242                                                                                         | 46,459                                                                                          | 48,018                                                                                          | 40,693                                                                       | 35,328                                                                       | -171,783                                                                     | 1,559             |
|                                                                                                 | 32 UNITED BANK OF INDIA                                                                         | -                                                                                               | -                                                                                               | 1,021                                                                                           | 7,505                                                                                           | 7,568                                                                                           | -                                                                            | 1,021                                                                        | 6,484                                                                        | 63                |
|                                                                                                 | 33 VIJAYA BANK*                                                                                 | 45,081                                                                                          | 49,098                                                                                          | 61,246                                                                                          | 64,116                                                                                          | -                                                                                               | 4,017                                                                        | 12,148                                                                       | 2,870                                                                        | -64,116           |
|                                                                                                 | 34 YES BANK LTD                                                                                 | -                                                                                               | 93,569                                                                                          | 265,508                                                                                         | 499,505                                                                                         | 550,295                                                                                         | 93,569                                                                       | 171,939                                                                      | 233,997                                                                      | 50,790            |
|                                                                                                 | Total                                                                                           | 24,500,217                                                                                      | 29,842,235                                                                                      | 37,484,955                                                                                      | 47,088,647                                                                                      | 48,920,802                                                                                      |                                                                              |                                                                              |                                                                              |                   |
|                                                                                                 | *: Vijaya Bank and Dena Bank merged with Bank of Baroda w.e.f. April 1, 2019                    | *: Vijaya Bank and Dena Bank merged with Bank of Baroda w.e.f. April 1, 2019                    | *: Vijaya Bank and Dena Bank merged with Bank of Baroda w.e.f. April 1, 2019                    | *: Vijaya Bank and Dena Bank merged with Bank of Baroda w.e.f. April 1, 2019                    | *: Vijaya Bank and Dena Bank merged with Bank of Baroda w.e.f. April 1, 2019                    | *: Vijaya Bank and Dena Bank merged with Bank of Baroda w.e.f. April 1, 2019                    | *: Vijaya Bank and Dena Bank merged with Bank of Baroda w.e.f. April 1, 2019 | *: Vijaya Bank and Dena Bank merged with Bank of Baroda w.e.f. April 1, 2019 | *: Vijaya Bank and Dena Bank merged with Bank of Baroda w.e.f. April 1, 2019 |                   |