SBI Cards and Payment Services Limited, the issuers of SBI credit card, is very bullish about its credit card business in India that has seen constant growth over the last few years. The company has seen healthy growth post the demonetisation era as more and more people are preferring to use credit cards with a stupendous growth in digital transactions. With a customer base of nine million and a market share of 17 per cent and operations in more than 130 locations in India, the company is further looking at expanding its business.
“We have seen good top line growth as more hard cash is moving towards digital payments. Interestingly, we have seen major growth in tier II and tier III cities and majority of our business is coming from these towns when compared to the metros. Aspirations of small town people are very high and the spends per card has increased in smaller towns of the country. Demonetisation gave a major push to our business. Although we are now planning to have an IPO (Initial Public Offering), we are waiting for a few regulatory approvals before making our final announcement. There are, however, many unconfirmed reports about the date of our IPO announcement,” Hardayal Prasad, MD and CEO, SBI Cards told THE WEEK.
The company says that its Cards-in-Force (credit cards outstanding) for SBI card had seen growth, and from March 31, 2017 to March 31, 2019 its total credit card spends grew at 54.2 per cent CAGR (as compared to 35.6 per cent CAGR for the overall credit card industry, according to the RBI) and the number of SBI credit cards outstanding grew at 34.5 per cent CAGR (as compared to 25.6 per cent CAGR for the overall credit card industry, according to the RBI). SBI Cards had 9.46 million credit cards outstanding as of September 30, 2019 and had 8.27 million credit cards outstanding as of March 31, 2019.
“People have increasingly started using credit cards because they are getting multiple offers such as sales offers, discounts etc. This has lead to an increase in spends per credit card. At the same time we are also making our credit cards more security proof and have come up with multiple innovative ways to get effective fraud protection. One of our latest innovations is to have contactless payments at Near Field Communication (NFC) enabled point of sale terminals with just one tap of their mobiles, without using the physical credit card or entering any PIN. This was a first of its kind payment solution in India,” added Prasad.
SBI Cards has also partnered with the Landmark Group, the retail major operating in the Middle East and India, to launch a set of retail co-branded credit cards- Lifestyle Home Centre SBI Card, Max SBI Card and Spar SBI Card. These cards are aimed to be a one stop payment solution for an entire family across categories such as fashion, home furnishing including furniture and grocery. Cardholders of any of these cards would be able to avail similar benefits at all participating Landmark brands through a single card.
