Whenbwill Diners Club Offer Consumer Cards Again
Disclaimer: Everything expressed beneath are only my own personal views and opinions reg. the latest news from RBI. It may or may not be factually correct.
RBI is on full swing lately and have banned multiple credit card issuers from acquiring new credit card customers. Here's everything you need to know about them.
Tabular array of Contents
- American Express
- When will the ban be lifted?
- HDFC Bank
- When will the ban exist lifted?
- Diners Lodge
- Customer Affect
- Where volition new customers go?
- Why RBI is crude?
- Final Thoughts
American Limited
- The Ban: Can't acquire new customers from 1st May 2021.
- The Reason: Payments data are not stored locally.
RBI in the past has passed the circular dated April 6, 2018 on Storage of Payment System Information advising all payment organisation providers ("PSPs") to ensure that information, relating to payment systems operated past them ("Payments Data"), is stored in India.
Information technology seems Amex has crossed the borderline and so is the ban. I'm certain American Express is not a company that ignores "regulations" but I'm shocked to run into this. I wonder what Amex was doing for 2 years!!
Apart from regulation, information technology will also help customers, equally transactions on Amex network is now calculated on EST time-zone which doesn't assistance those doing last minute transactions on few cards to avail the monthly bonus.
When volition the ban be lifted?
Depends on how adept Amex is prepared to handle this.
If they have already fabricated things ready and are in final phase (hoping so), maybe Amex would submit the necessary documents alee of 1st May 2021 or may take about a month max to go it sorted.
If not, forget nearly the lift of ban for side by side ~half dozen months. Simply I doubt about longer delays, equally American Express India does only Cards business primarily and this ban would affect the life of thousands of Amex Employee's – especially those in sales – the already stressed segment due to the pandemic.
Side note: Possibly this is somewhere related to the contempo update with Amex and CIBIL reports. So maybe they're already on it, to an extent?
HDFC Bank
- The Ban: Can't acquire new customers from 2nd Dec 2020.
- The Reason: Frequent Outages with HDFC Internet/mobile cyberbanking, etc
- Ban lifted
Its been most four months since the ban has been placed on HDFC from issuing new cards. I'm surprised to see that the ban is still not lifted on Bharat's #1 bank – equally they call so.
When volition the ban exist lifted?
Every bit per the details I got from guys handling servers: I'1000 expecting it to happen in ~6 months timeframe as that'south the fourth dimension taken to transfer the data to the new infrastructure, and then report it and get a green bespeak from RBI.
We're getting closer to that 6 months now and as of mid April 2021, it seems a third party Inspect is happening on the upgraded infrastructure and is in the final stage now. So we will have to wait and see.
Diners Club
- The Ban: Tin can't acquire new customers from 1st May 2021.
- The Reason: Payments data are not stored locally.
- Ban lifted on 9th Nov 2021
This is same as the Amex event seen above, but I wonder how it matters, as anyway HDFC – the network partner for Diners Club is having the payments data of Diners cards with them locally in Republic of india.
Perchance RBI want Diners to process these Diners payments from Republic of india. If and then, I don't think this is going to happen anytime shortly. But I maybe wrong also, as I'thousand not certain of the development with Diners Gild.
The Fun Fact: India has merely banned the company that invented the concept of credit cards. That's right. Diners Gild International, founded in 1950 was the first contained credit card company in the world to event credit cards.
All types of Miracles happen in India! Its good to see RBI showing the power of Bharat. But at the same time wish they as well amend the domestic payment systems like Rupay.
Client Impact
- New Customers: Its a bad news for those who're new to Amex & HDFC, as they have one of the amazing credit card products in the country.
- Existing Customers: It's a normal day for existing customers and are allowed to upgrade/downgrade cards as they wish, within the issuer.
Apart from above, existing customers may enjoy lucrative offers from HDFC & Amex to avoid customers moving out and to geenrate more revenue.
We've seen this already with HDFC and it would be interesting to encounter from Amex too at present. Expect some mind-blowing merchant/targeted offers from American Express if the ban goes alive from 1st May 2021.
Where will new customers get?
With the ban on HDFC & Amex from Issuing new cards, where will the new cardholders go?
The mass market segment would motion to SBICards, ICICI & others. That applies well for HDFC.
But those in premium segment and those who're knowledgable would go for other premium issuers like Axis, SC and even Citi as they're yet active in menu issuance.
I personally feel its an amazing opportunity for Axis Depository financial institution. Hope Axis strikes while the iron is hot. But I wish Axis speeds up the onboarding process.
Why RBI is rough?
I wonder why RBI is taking such huge decisions in short detect. I mean, I wish a circular similar placing a ban on master revenue source of a business is amend sent a "month" in advance.
Only actions like these might force good strange companies too to move out of the country – merely like how Citi exit Bharat recently. While Citi says it's more of a business organization decision, some exercise say that one of the reason is: regulations in Bharat are not favourable for Citi with current setup.
So what's the reason for all these rough decisions past RBI in payments industry? That too why particularly on credit card issuers? Maybe all of them to favour SBICard? or is it mere coincidence? We never know!
Too, I call back its essential for RBI to take such steps, perhaps considering the banking industry has had enough scam's in the by and mayhap RBI is pro-active now to control that.
Looking at the trend, I wish Visa & Mastercard are not in the queue to be banned next. Let'south hope they obey the rules!
Terminal Thoughts
In a nutshell, RBI has put a ban on two of the best credit card companies in the state – the simply ii issuers serving premium customers pretty well, excluding Citi every bit they're leaving India anyway.
While Covid-19 is giving shocks to humans every other mean solar day, RBI is giving equal shocks to credit card companies every now and and then.
RBI is hopefully doing the right thing for India every bit a whole, but I think it could be washed meliorate, smoother and in a more than friendly way.
Like, they could instead put a punishment on these companies and apply those funds to speed upwards the Covid-19 Vaccination drive, amidst many other things to build a amend India.
Let's hope the pandemic settle downwardly at the primeval and hope both American Express & HDFC get's back in game soon and smoothen bright like a diamond.
Source: https://www.cardexpert.in/rbi-ban-amex-hdfc-diners-club/
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