HDFC Bank joined hands with the country's largest airline IndiGo to launch a co-branded credit card, which will effectively work like a loyalty programme for the carrier.
Labelled Ka-ching, the card will offer many benefits like complimentary air tickets, lounge access, 5 per cent cashback or reward points on Indigo bookings, and 3 per cent cashback on dining, grocery and entertainment, the companies said.
With over 14 million active cards, HDFC Bank is by far the largest credit card issuer in the country, and hopes to sell 1 million Ka-ching cards over the next three years.
Parag Rao, head of the cards business at the bank, told PTI that around 20 per cent of its total cards are co-branded, and such cards see around 30 per cent more spending.
The bank also has similar tie-ups with Walmart and Times Group. It also had a similar card with the now-defunct Jet Airways.
Rao said travel and hospitality contribute 12-13 per cent of total spend on the bank's credit cards.
About the delinquency rate in the cards business, Rao said like the parent HDFC Bank, which has the best asset quality with under 1.5 per cent bad loan levels, cards business also has the lowest NPA levels.
He, however, did not quantify it in percentage.
IndiGo Chief Commercial Officer William Boulter said this is the first such tie-up for the airline and expressed hope that Ka-ching card will help it increase customer satisfaction.
The premium variant of the card offers complimentary air tickets worth Rs 1,500-3,000 apart from host of other benefits, and can be redeemed against its tickets, Boulter said.
He said customers can also earn 10-15 per cent rewards on dining, shopping, transport, medical bill spends with featured partners, apart from priority check-in, seat choice, and complimentary meals.
Speaking at an event to launch the co-branded credit card in the national capital, Boulter said it is not a traditional frequent flyer programme.
"Co-branded credit card is a reward programme... much better than a loyalty programme," he said.
The card is being launched in partnership with Mastercard, which is the largest issuer for HDFC Bank, Rao said.
Porush Singh of Mastercard said Ka-ching card comes with the highest safety standards.
He said co-branded cards constitute as much as 30 per cent of total cards in company's home market in the US.