**Summary:**
The Reserve Bank of India (RBI) issued a directive on March 6, 2024, (Reference No. CO.DPSS.POLC.No.S1133/02.14.003/2023-24) addressing arrangements between authorized card networks (American Express Banking Corp., Diners Club International Ltd., MasterCard Asia Pacific Pte. Ltd., National Payments Corporation of India-RuPay, and Visa Worldwide Pte. Limited) and card issuers (banks and non-banks) concerning credit card issuance.
The directive, issued under Section 18 read with Section 102 of the Payment and Settlement Systems Act, 2007, aims to enhance customer choice. It mandates that:
* Card issuers shall not enter into agreements that restrict them from using multiple card networks.
* Card issuers must provide eligible customers with the option to choose from multiple card networks at the time of issuance, and for existing cardholders, at the time of renewal.
These directions apply to existing agreements upon amendment or renewal and to all new agreements. However, card issuers with 1 million or fewer active cards, and those issuing cards solely on their own authorized card network, are exempt from the customer choice provision (point 3b). The customer choice provision will be effective six months from the date of the circular.
For further information, contact the Department of Payment and Settlement Systems, Central Office, Reserve Bank of India, 14th Floor, Central Office Building, Shahid Bhagat Singh Road, Fort, Mumbai – 400001. Phone: 91-22-2264 4995; Fax: 91-22-22691557; email: cgmdpsscorbi.org.in.
Key Entities Referenced
Visa Worldwide Pte. Limited: An authorized card network operating in India.
Reserve Bank of India: The central bank of India, responsible for regulating the banking sector and payment systems.
Payment and Settlement Systems Act, 2007: An act of the Indian Parliament that provides for the regulation and supervision of payment systems in India.
American Express Banking Corp.: An authorized card network operating in India.
Diners Club International Ltd.: An authorized card network operating in India.
MasterCard Asia Pacific Pte. Ltd.: An authorized card network operating in India.
National Payments Corporation of India-Rupay: An authorized card network operating in India.
Mumbai, Maharashtra: The city in Maharashtra where the Central Office of the Department of Payment and Settlement Systems is located.
भारतीय �रज़व� ब�क
RESERVE BANK OF INDIA
www.rbi.org.in
RBI/2023-24/131
CO.DPSS.POLC.No.S1133/02-14-003/2023-24 March 06, 2024
The Chairman / Managing Director / Chief Executive Officer
Authorised Payment System Providers / Participants (Banks and Non-banks)
Madam / Dear Sir,
Arrangements with Card Networks for issue of Credit Cards
The authorised card networks tie-up with banks / non-banks for issuance of credit cards. The
choice of network for a card issued to a customer is decided by the card issuer (bank / non-
bank) and is linked to the arrangements that the card issuers have with card networks in terms
of their bilateral agreements.
2. On a review, it is observed that some arrangements existing between card networks and
card issuers are not conducive to the availability of choice for customers.
3. In exercise of the powers conferred under Section 18 read with Section 10(2) of the
Payment and Settlement Systems Act, 2007 (Act 51 of 2007), the RBI being satisfied that it is
necessary and expedient, in the interest of payment system and public interest, to do so,
hereby, directs as under:
a) Card issuers shall not enter into any arrangement or agreement with card networks
that restrain them from availing the services of other card networks.
b) Card issuers shall provide an option to their eligible customers to choose from
multiple card networks at the time of issue. For existing cardholders, this option may
be provided at the time of the next renewal.
For the purpose of these directions, the following definitions are used:
i) Authorised card networks: American Express Banking Corp., Diners Club
International Ltd., MasterCard Asia/ Pacific Pte. Ltd., National Payments Corporation
of India–Rupay, and Visa Worldwide Pte. Limited.
भुगतान और िनपटान प्रणाली िवभाग, क�द्रीय काया�लय, 14वी मंिजल, क�द्रीय काया�लय भवन,शहीद भगत िसंह माग�, फोट�, मु�ई- 400001
फोन / Tel: (91-22) 2264 4995; फैक्स / Fax: (91-22) 22691557; ई-मेल / e-mail : cgmdpssco@rbi.org.in
Department of Payment and Settlement Systems, Central Office, 14th Floor, Central Office Building, Shahid Bhagat Singh Road, Fort, Mumbai -
400001
िहंदी आसान है, इसका प्रयोग बढ़ाइए4. Card issuers and card networks shall ensure adherence to the above requirements in:
a) existing agreements at the time of amendment or renewal thereof, and
b) fresh agreements executed.
5. The directions at 3(b) above shall not be applicable to credit card issuers with number of
active cards issued by them being 10 lakh or less in number.
6. Card issuers who issue credit cards on their own authorised card network are excluded from
the applicability of the circular.
7. The directions at para 3(b) above shall be effective six months from the date of this circular.
Yours faithfully,
(Gunveer Singh)
Chief General Manager-in-Charge