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Neha Kaushik
Nithya Subramanian

NEW DELHI, Jan. 25

SBI Cards & Payment Services is currently in talks with SBI Life Insurance Company Ltd to develop customised insurance products for its cardholders.

According to Mr Iqbal Singh, Chief Executive Officer, SBI Cards: "We are working on insurance products, especially for our cardholders.''

The company also plans to enhance the value of its cards by going in for tie-ups with other companies.

It already has a tie-up with Indian Oil Corporation, which enables a customer to buy petrol without paying additional fees. However, the company has decided against going in for co-branded cards.

SBI Cards (the joint venture between SBI and the financial services company, GE Capital, which markets and distributes SBI cards in India), launched three years ago, has already issued 9,00,000 cards in the country becoming the largest issuer of Visa cards.

It is targeting the one-million mark this year, and hopes to become the number one card by 2003.

Currently, the market is estimated at 5.5 to 6 million credit cards, growing at 20-25 per cent. Citibank leads the pack with 1.4-1.5 million cards, while SBI Cards is at number three.

According to Mr James Murray, Executive Vice-President, South-East Asia, Visa International: "Spends on cards have been on the rise, and it is moving from being an elitist product to a more mass-market product''.

According to Mr Santanu Mukherjee, Managing Director, Visa Consolidated Support Services: "The average annual spend on the classic cards is Rs 17,000-18,000, and the spend on gold card is around Rs 22,000.'' Spends on SBI Cards have also been along the same lines. There is much scope for growth with approximately 25-30 million potential cardholders in the country, he says.

SBI Cards is further looking at expanding its card base by embarking on new initiatives, which include simplification of entry-level procedures by issuing a credit card on the basis of a PPF account, tying up with more distributors in semi-urban areas, direct marketing initiatives and so on. Currently, over half of SBI Cards' card base comes from outside the 7-8 metros.

The company is also considering add-on cards to generate substantial business, with currently one-third of its database being add-ons.

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