(a) whether banks suffered losses under the credit card scheme;
(b) if so, the details thereof;
(c) whether a fresh scheme is being launched in place of the present one;
(d) if so, the details thereof;
(e) whether the interest rate on the outstanding amount of the credit card holders has
been increased/being increased; and
(f) if so, the details thereof?
MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI PAWAN KUMAR BANSAL)
(a) & (b): The existing Management Information System of Reserve Bank of India (RBI) does not
generate the desired data.
(c) & (d): The banks may frame their own credit card schemes as per their business plans
subject to the guidelines / instructions issued by RBI from time to time.
(e) & (f): In terms of paragraph 3 of Master Circular dated 2nd July, 2007, banks have been
advised that credit card dues are in the nature of non-priority sector personal loans and
as such banks are free to determine the rate of interest on credit card dues without reference
to their Bench Prime lending Rate (BPLR) and regardless of the size. However, RBI has
advised the banks that the annualized percentage rate (APR), the method of calculation
of APR, late payment charges including the method of calculation, the manner in which the
outstanding unpaid amount is to be included for calculation of interest, etc. on credit card
dues should be indicated by card issuing banks in the `Welcome Kit` and monthly statement.
Banks have also been advised to be transparent in fixing their interest rate / service charge
on credit card dues and include the above in the Most Important Terms and Conditions (MITCs).
Further, credit card scenario is being constantly monitored and instructions to banks on
their credit card operations are issued by the RBI, on an ongoing basis.