A month after the Reserve Bank of India (RBI) partially lifted the ban on HDFC Bank, allowing it to restart credit card issuance, the lender on Monday announced its partnership with Paytm for the sale of credit cards co-branded from October, coinciding with the start of the festival season.
The credit cards would be activated by Visa and will target a select clientele including young people, traders and businessmen, according to a statement released by HDFC Bank.
“Credit cards will be customized to meet the distinct needs of retail customers, from new users on credit to affluent users, and will offer one of the best rewards and cash back to users,” the statement said.
The merger aims to deliver superior value and customer experience, with HDFC Bank and Paytm leveraging their respective strengths, the statement added.
“The alliance will target deeper penetration into Level II and Level III markets and enable faster acceleration of digitized payments across the country,” the two entities said.
Paytm has a customer base of over 330 million consumers and 21 million merchants, while HDFC Bank has over 5 million customers using debit, credit and prepaid cards.
On December 2, 2020, the RBI banned HDFC Bank from issuing credit cards after receiving complaints about frequent outages in its internet and mobile banking systems.
Although the central bank lifted the ban on August 18, 2021, allowing HDFC Bank to issue credit cards, restrictions on new digital launches remain.