HDFC Bank and Paytm, India’s leading digital financial platforms for consumers and merchants, have planned to launch a comprehensive range of VISA-enabled credit cards. The partnership, which is a first of its kind, aims to provide one of the broadest ranges of services across customer segments, with a special focus on younger consumers, business owners, and merchants.
HDFC Bank has been at the forefront of consumer payment services. They have introduced various debit cards and credit cards to suit individual needs. These cards are also designed to adapt to the market scenario and give maximum benefits to its users. The latest addition to this kitty is a credit card in partnership with digital payments giant Paytm!
Paytm has been in the digital payments space since 2010. They even recently launched their IPO which was superbly subscribed by its loyal customers. Paytm is constantly innovating and releasing digital products to make payments more convenient and beneficial for its users. They have collaborated with HDFC Bank to introduce a credit card with a lot of features and rewards.
What Kind Of Credit Cards Will They Issue?
The credit cards will be tailored to meet the specific needs of retail customers, ranging from first-time credit users to affluent users, and will provide users with some of the best-in-class rewards and cashback. Small business owners will benefit from the new card offering as well.
To begin with, they are planning to introduce business credit cards, which come with a host of benefits for merchant partners from the smaller cities and towns of India, thus allowing them easier access to credit with quick paperless approvals.
Also Read: Best Credit Cards to Get in 2021
What Benefits Will These Credit Cards Come With?
The cards are being introduced to capitalize on the festival season when there is usually a high demand for consumer products. This will translate into more credit card transactions, higher EMI conversions and ‘Buy Now Pay Later (BNPL)’ transactions.
As an additional bonus, the cards will offer higher cashback to their users. A Mobile credit card aimed at digital-first millennials will be among the credit card products available. Users can apply digitally and without documents, and then complete the onboarding process entirely through the Paytm app.
HDFC Bank has long been a market leader in the credit card industry. In the credit card department alone, they have a market cap of 14.76 million customers. Every third rupee spent through credit cards in India is spent using an HDFC Bank card, which has over 5.1 crore credit cards, debit cards, and prepaid cards, as well as over 2 million merchants addressing every market segment. As a result, the Bank has played an important role in propelling India’s consumption story over the years. However, as a result of recent guidelines and restrictions on credit card issuance, this base has dropped by as much as 2%, while competitors have gained a significant share. Following the relaxation of these guidelines, HDFC Bank intends to return stronger and gain a significant customer share in the credit card market.
When Are They Planning To Launch These Credit Cards?
The credit cards are going to be launched in October 2021, to capitalize on the Dussehra and Diwali festival season. They expect that the higher consumer demand will improve the issuance of these credit cards, the full suite of which is expected to be operational by the end of December 2021.
Role Of Paytm In This Partnership
Customers will benefit from the relationship by leveraging each other’s expertise: HDFC Bank’s position as India’s largest credit card issuer and strength in offering excellent customer engagement, and Paytm’s digital expertise and reach of over 330 million consumers. The partnership will focus on active targeting in Tier II and Tier III areas, as well as accelerating the adoption of digital payments across the country.
What Do Experts Feel About This Partnership Between HDFC And Paytm?
Bhavesh Gupta, CEO of Paytm Lending, explained how Paytm aims to democratize loan access to drive financial inclusion among its 330 million+ customers and 21 million+ merchant partners. Paytm’s merchant partners and India’s new-to-credit millennials will now be able to create a good credit profile and gain access to possibilities accessible in the formal economy thanks to their superior technological capabilities. He also expressed his enthusiasm in partnering with HDFC Bank and Visa to introduce a comprehensive suite of credit cards for a wide range of client groups, with a particular focus on millennials, business owners, and merchants. He claims that these Business Credit Cards were developed with a thorough understanding of their merchant partners in mind, as well as the notion that these services will be beneficial to their enterprises.
Parag Rao, Group Head – Payments, Consumer Finance, Digital Banking & IT, HDFC Bank, said: “As India’s largest card issuing and acquiring bank, we are committed to accelerate the adoption of digitization in the country. We believe India’s growth story is robust and this partnership is an effort on Bank’s part to enable consumption, particularly, during festive season, which will further fuel the economic growth of the country. As a leader in the cards space, our objective is to help enlarge the ecosystem through such collaborations, which ultimately offers a differentiated experience for customers.” (Source: www.hdfcbank.com)
T R Ramachandran, Group Country Manager, India and South Asia, VISA said, “Consumers and businesses alike are embracing digital payments today. We are proud to partner with Paytm and HDFC Bank and deploy the full suite of Visa solutions and capabilities, as they launch an array of world-class products to tap into the potential of this vast and diverse customer set. With cards designed to suit the needs of each type of customer – from the new-to-credit to the digitally savvy and small merchants, I am confident this partnership will enable and drive access to credit.” (Source: www.hdfcbank.com)
Both HDFC and Paytm are big names in the financial world. Their partnership promises a truly beneficial enterprise to its customers; especially small-scale business owners who are in a dire financial situation, due to the recent coronavirus pandemic and the resulting economic crisis. We are eagerly waiting to see how these credit cards perform.