Indian Bank launches credit card

Indian Bank plans to target 2 million customers with its newly launched global Visa credit card.

Addressing a press conference at the launch of its global Visa credit card, B Sambamurthy, executive director, Indian Bank, said one might think that the bank was late in launching its own credit card, when there were already about 20 banks offering the services. He explained that the bank identified this as the right time to introduce its own credit card.

"The credit card industry is growing at 40 per cent per annum while credit is growing at 22 to 25 per cent. There are about 100 million population in the age group of 17 to 21 years who would start earning in the next three years, and the bank estimates them as potential customers," he said.

Of the 15 million customers, the bank has identified over 2 million as potential customers for credit card. Uttam Nayak, deputy country manager, Visa Consolidated Support Services India, pointed that point of sale for credit and debit cards merchant establishments had grown to 2.5 lakh and the number of ATMs had crossed 20,000 in the last 12 months.

"Therefore, it is the right time for Indian bank to enter the credit card business. The scenario was different three years ago with only 35,000 merchant establishments and 5,000 ATMs," Nayak added.

It is estimated that cash worth about $50 billion was withdrawn from bank ATMs last year. If there is more penetration of credit cards, even if banks can garner at least one per cent of this revenue, it would translate into Rs 2,175 crore, Nayak said.