India’s HDFC bank sets ambitious target for card issuance, source says
MUMBAI, Aug. 18 (Reuters) – India’s most valuable lender, HDFC Bank (HDBK.NS), has laid out an ambitious plan to more than double the monthly card issuance from September after the central bank lifted a temporary ban on HDFC in December, according to a source.
“Sales teams have been urged to reach an issuance target of 500,000 cards per month from September for the next few months,” said the source directly familiar with the matter.
HDFC Bank, which in September 2020 had issued nearly 200,000 cards, did not immediately respond to a request for comment.
The latest goal is a big jump from a year ago, but some analysts have said it is achievable given the number of “passive” or savings accounts it has opened this year. Savings account holders are typically sold credit cards and direct lender loans.
“Having added nearly 3.65 million liability accounts from January 2021 to June 2021, it can easily capture market share in the credit card space,” Macquarie said in a research note.
Earlier, the bank had said in a regulatory filing that India’s central bank had eased restrictions placed on it last year on issuing new credit cards, following outages in the country’s digital payment services. Bank.
The relaxation was well received within the company.
“All the preparations and strategies that we have in place to ‘come back with a vengeance’ (on credit cards) are now going to be rolled out,” HDFC Bank Managing Director Sashidhar Jagdishan said in an internal email. to employees, a copy of which was seen by Reuters.
“In the coming months, we will aggressively enter the market with not only our existing line of credit cards, but also new offerings in the form of co-brands and partnerships,” Jagdishan said in the e- mail.
With nearly 15 million credit cards in circulation, HDFC Bank is the leading lender in the segment with almost 24% of the market. Yet over the past eight months, peers such as ICICI Bank (ICBK.NS) and SBI Cards (SBIC.NS) have gained ground.
In June, ICICI Bank had 11 million credit cards, up from around 10 million in January.
“The lifting of the RBI (Reserve Bank of India) restrictions ahead of the holiday season bodes well and we expect HDFC Bank to become more aggressive on credit cards in the coming months,” said the brokerage firm Motilal Oswal.
HDFC Bank is the seventh most valuable lender in Asia Pacific with a market capitalization of 8.37 trillion rupees ($ 112.7 billion).
($ 1 = 74.2560 Indian rupees)
Report by Nupur Anand in Mumbai; Additional reporting by Chris Thomas in Bangalore; Editing by Shounak Dasgupta and David Holmes
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