Mumbai6 minutes ago
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- RBL Bank, Yes Bank and Bajaj Finserv are completely dependent on MasterCard
- SBI and SBI card issue with MasterCard only 10% of the total card
The biggest impact of the ban on MasterCard will be on 5 banks of the country. This includes the private sector Axis Bank, Yes Bank, IndusInd Bank, the largest public sector banks State Bank of India (SBI) and Bajaj Finserv. It may take 2-3 months for them to migrate to other platforms.
Nomura released the report
Global brokerage firm Nomura has said in a report that the impact of the Reserve Bank’s ban on MasterCard will be directly reflected on these banks. Because these banks issue more cards on the same platform as MasterCard. The Reserve Bank has banned MasterCard from issuing new cards citing rules. This rule is about local data storage.
There will be no impact on HDFC Bank
This restriction will not have an effect on HDFC Bank because last year itself, the Reserve Bank of India (RBI) had banned it from issuing new debit and credit cards. According to Nomura, a total of 7 financial institutions will be affected by this move of the Reserve Bank. This means that they will not be able to issue new cards on the MasterCard platform. They will have to use another payment gateway to issue a new card and it will take 2 to 3 months.
According to the report, among the credit card issuers, which also have co-branded partners, RBL Bank, Yes Bank and Bajaj Finserv will be the most affected. Because all their schemes are with Mastercard only.
More impact on RBL Bank, Yes Bank and Bajaj Finserv
According to the report, RBL Bank, Yes Bank and Bajaj Finserv are completely dependent on MasterCard in terms of card issuance. While the dependence of IndusInd Bank, Axis Bank and ICICI Bank is 35 to 40%. SBI and SBI Cards issue only 10% of their total card issue with MasterCard. So there will be less impact on them.
Kotak Mahindra Bank completely dependent on Visa
Kotak Mahindra Bank’s card portfolio is completely dependent on Visa and hence will not see any impact. Axis Bank and ICICI Bank recently tied up with Flipkart and Amazon for their co-branded cards. Meanwhile, RBL Bank on Thursday said it will partner with Visa Worldwide to issue the cards. It will use the Visa platform in the case of credit cards. The bank will be able to issue cards on Visa’s platform only after at least 8-10 weeks.
With the ban on MasterCard, many banks will have to change their entire technology. However, this restriction will not have any effect on the cards already issued.