In compliance with recent directives from the Reserve Bank of India (RBI), card issuers are now obligated to offer their eligible customers the flexibility to select from a range of card networks during card issuance. This mandate extends to existing cardholders, who must be presented with network options upon the next renewal of their cards.
The RBI’s directive explicitly prohibits card issuers from engaging in agreements or arrangements with card networks that limit or impede their ability to access services from other networks. Under this directive, card issuers are mandated to ensure that customers have the opportunity to choose from various card networks at the point of card issuance or renewal.
Authorized card networks eligible for selection include American Express Banking Corp., Diners Club International Limited, MasterCard Asia/Pacific Pte. Limited, National Payments Corporation of India — Rupay, and Visa Worldwide Pte. Limited. Traditionally, these networks have collaborated with banks and non-banking entities for credit card issuance.
Previously, the choice of card network for a customer was typically determined by the issuing institution (bank or non-bank) and was influenced by bilateral agreements between the card issuers and networks. However, the RBI’s intervention aims to ensure that customers are not bound to a particular network and are provided with the freedom to choose according to their preferences.
The RBI’s review identified that certain existing arrangements between card networks and issuers did not foster an environment conducive to customer choice. Consequently, the directive emphasizes that card issuers cannot compel customers to adopt cards from specific networks, thereby affirming the importance of consumer autonomy in network selection.