RBI asks card issuers to give users choice of selecting network

MUMBAI, Mar 06 (Reuters): India's central bank on Wednesday said issuers of credit cards cannot enter into any arrangement or agreement with card networks that restrain customers from availing the services of other networks.

"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," the Reserve Bank of India (RBI) said in a circular.

Issuers will have to provide an option to customers to choose from multiple networks at the time of the card's issuance, the RBI said.

The change has been made solely to enhance customer choice, a source familiar with the central bank's thinking, said.

For existing cardholders, the option would have to be provided at the time of the next renewal, the RBI said.

The requirement to offer customers a choice of card networks will become mandatory six months from March 6, the RBI added.

Issuers with less than 1 million active credit cards are exempted from the requirement, while those who issue cards on their own authorised network are also excluded.