**Summary:**
The Reserve Bank of India (RBI) issued a directive on March 6, 2024, (Reference No. RBI/2023-24/131 CO.DPSS.POLC.No.S1133/02-14-003-2023-24) addressing arrangements between authorized card networks (American Express, Diners Club, MasterCard, Rupay, and Visa) and card issuers (banks and non-banks) regarding credit card issuance. This directive, issued under Section 18 read with Section 102 of the Payment and Settlement Systems Act, 2007, aims to enhance customer choice in card network selection.
The key provisions of the directive are:
* Card issuers are prohibited from entering into agreements that restrict them from using multiple card networks.
* Card issuers must provide eligible customers with the option to choose their preferred card network at the time of issuance or renewal.
These requirements apply to existing agreements upon amendment or renewal, and to all fresh agreements.
Exemptions:
* Card issuers with 1 million or fewer active cards are exempt from providing customers with a choice of card network at issuance/renewal.
* Card issuers who issue credit cards on their own authorized card network are excluded from the applicability of the circular.
The directive regarding customer choice of card network (para 3b) takes effect six months from the date of the circular.
For further information, contact the Department of Payment and Settlement Systems, Central Office, RBI at cgmdpsscorbi.org.in, or by phone at 91-22-2264-4995. The mailing address is 14th Floor, Central Office Building, Shahid Bhagat Singh Road, Fort, Mumbai – 400001.
Key Entities Referenced
Reserve Bank of India: The central bank of India, the issuing authority of the circular.
Payment and Settlement Systems Act, 2007: Indian legislation that empowers the Reserve Bank of India to regulate payment and settlement systems in the country.
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, developed indigenously.
Visa Worldwide Pte. Limited: An authorized card network operating in India.
Mumbai, Maharashtra: The city in Maharashtra where the Central Office of the Reserve Bank of India 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