Credit card rewards are being reset, not rolled back, says BOBCARD CEO

Ravindra Rai BOBCARD

• Credit cards now focus on everyday value, discipline, and personalised rewards
• Responsible usage and timely repayment define a good credit card user
• Multiple cards provide flexibility with proper billing cycle and repayment management.

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Credit cards are going through a major shift; reward caps are shrinking, lounge access is harder to unlock, and new fees are creeping in, but Ravindra Rai, MD & CEO of BOBCARD points out, credit cards are far from losing their relevance. In an exclusive conversation with Moneycontrol, Rai explains who really counts as a ‘good’ card user, the pitfalls first-timers face, and how everyday spending can be optimized without overspending.

From travel rewards and multi-card strategies to the outlook for 2026, he explains how credit cards are evolving into smarter, more personalized tools, blending convenience, discipline, and real financial value.

• Who counts as a ‘good’ credit card user: someone who avoids interest, or someone who uses credit actively but repays on time?

From a system-wide perspective, a good credit card user is one who uses credit regularly and responsibly, while repaying on time. Credit cards are designed to support short-term liquidity and convenience, not to encourage long-term indebtedness. Users who manage their spends well, maintain healthy repayment behaviour, and stay within their means contribute to a more stable and sustainable credit ecosystem.

Earlier, credit cards in India were used largely for big-ticket or discretionary purchases. With innovations such as UPI-linked credit cards, usage has expanded to smaller, everyday transactions, allowing consumers to earn rewards or cashback on routine spends when used smartly and with discipline. This shift is helping reimagine credit cards as an everyday payment tool rather than an occasional credit instrument.

Issuers therefore reward behaviour that reflects responsible usage such as timely repayments, consistent activity, and disciplined credit management rather than interest dependence.

• What’s the biggest mistake first-time card users make, and why does it keep happening?

For many first-time card users, the mistake is simple: spending feels effortless, but repayments don’t get the same attention. Digital payments make it easy to swipe without thinking through billing cycles, due dates, or how much of the limit is actually safe to use.

It’s not that young earners don’t know this - it’s that experience comes later. Until spending and repayment are consciously linked, small slips can quickly turn into carried balances or missed payments.

• When does credit card convenience turn into lifestyle inflation for younger users?

Credit cards may appear to sell a lifestyle, but issuers say they largely organise aspirations that already exist. The concern is not spending itself but when convenience begins to outpace income, especially for younger cardholders, making guardrails like prudent limits and repayment alerts essential.

Reward caps are shrinking, lounge access is harder to unlock, and new fees are appearing. Is this a temporary reset, or is the “golden age” of generous credit card rewards over?

As the credit card market matures, the scaling back of rewards is less a rollback and more a shift toward sustainable value. The early phase of growth was driven by generous, broad incentives to build adoption, but the focus is now moving to benefits relevant to everyday spending, and supportive of long-term financial health.

This approach is reflected in newer products such as BOBCARD’s TIARA card, which has been conceived as a women-centric proposition, positioned around practical, research-led features rather than headline lifestyle perks. The broader idea is to move away from aspirational rewards that few users unlock, toward benefits that card holders can actually use while maintaining transparency and credit discipline.

• Many users now juggle two, three, even five credit cards. Does having multiple credit cards improve financial outcomes or increase the risk of missed payments?

Having more than one credit card isn’t a problem by itself, as long as each card has a clear role and spending is planned. Trouble usually starts not because people hold multiple cards, but because they lose track of billing cycles, due dates and their total credit exposure, something seen more often among newer users.

With better awareness and timely reminders, multiple cards can still offer flexibility and choice without adding to financial stress.

• With so many credit cards in the market, how should consumers choose the right credit card: rewards, fees, credit limits, or usage habits?

Choosing the right credit card, should start with a simple question: how do you actually spend your money? Rewards, fees and credit limits matter, but only when viewed through real usage habits rather than headline benefits. A card aligned with everyday spending patterns tends to deliver more value over time than one picked for status or a single flashy feature.

Even with niche offerings, such as women-focused cards like BOBCARD’s Tiara, the idea is to assess how many benefits you will realistically use, rather than being swayed by how premium a card sounds. A high credit limit or generous rewards only work when matched with disciplined repayment and regular usage. In practice, relevance and consistency often matter far more than the size of rewards on paper.

• When benefits depend on hitting quarterly spend targets, what really happens? Do quarterly spend targets encourage disciplined use or push users to overspend?

Spend-linked benefits are meant to reward regular, planned usage, not push people to spend more. When targets are aligned with everyday spending and clearly communicated, they can actually help users track expenses more closely.

The risk arises when targets feel out of reach, nudging users to spend just to unlock a benefit. That’s why attainable targets, transparency and a strong focus on repayment matter, so rewards reinforce healthy behaviour rather than drive unnecessary spending.

• How realistic is it for an average cardholder to fund international trips or business-class flights purely with reward points?

For most cardholders, fully funding an international trip or a business-class flight through reward points is possible, but it’s not effortless. In my experience, it works best for people who are deliberate: they choose the right kind of card, concentrate their spending, and stay disciplined over time. It’s rarely realistic for occasional users expecting quick wins.

Travel-focused co-brand cards, such as our BOBCARD Etihad Guest Credit Card, are designed with this in mind. They help frequent or planned spenders accumulate miles faster across flights, everyday spending and partner categories. But what really matters isn’t headline multipliers. It’s routing a meaningful share of regular expenses through one core card, understanding where accelerated rewards actually apply, and planning redemptions around those sweet spots.

Fees and repayment behaviour are just as important. High-value travel redemptions only make sense when dues are paid on time and annual fees are clearly outweighed by the miles and travel benefits earned. When used thoughtfully, a focused strategy with a travel-centric card can turn everyday spending into international travel over time - but it does require patience, planning and financial discipline.

• Among your own credit card offerings, are there specific cards better suited for frequent revolvers versus disciplined, rewards-focused users?

In my view, different credit behaviours need different product designs - no single credit card works for everyone. Some customers are disciplined spenders who maximise rewards and pay their dues in full, while others value flexibility across travel, dining and everyday expenses. A responsible card portfolio has to account for these distinct usage patterns.

Within BOBCARD, our lifestyle and premium cards are built around how people actually spend. For instance, ETERNA is positioned for customers looking for premium travel and lifestyle benefits, while TIARA has been designed as a women-focused card with health, wellness and everyday lifestyle features at its core. BOBCARD One, our metal card, sits at the intersection of travel, shopping and daily spending, with rewards on every transaction and lower foreign exchange costs.

The underlying objective is alignment. When a card matches a customer’s spending habits and repayment discipline, it enhances convenience and rewards without pushing excess. That fit ultimately determines whether a credit card improves financial outcomes over time.

• What lesser-known credit card ‘hacks’ help earn better rewards or avoid unnecessary charges?In my experience, most value is lost on credit cards not because people miss rewards, but because small inefficiencies go unnoticed. One of the most overlooked aspects is the billing cycle. By timing larger, planned expenses just after the statement date, users can get the longest interest-free period without spending more.

Another blind spot is reward optimisation within existing habits. Many cards offer higher rewards on specific categories, but users often spread spending across multiple cards without checking where their regular expenses earn the most. Simply consolidating routine spends, like fuel, dining or travel, on the right card can improve rewards without increasing consumption.

Fees are another quiet leak. Foreign exchange mark-ups, late payment charges and auto-renewing subscriptions can erode value over time. Reviewing card terms periodically and setting payment reminders can make a meaningful difference. Ultimately, the most effective ‘hack’ is discipline. Credit cards reward consistency, awareness and timely repayment. Used with intent, they become tools for efficiency rather than excess.

• With UPI and BNPL growing, are credit cards still essential for the average consumer?

UPI and BNPL have certainly made payments faster and more convenient, but credit cards still play a unique role. They’re structured credit products that help build a formal credit history, manage larger or recurring expenses, and provide flexibility, protection, and rewards.

The key is evolution. Integrating credit cards with UPI, for example, allows users to enjoy UPI’s speed while retaining the discipline, transparency, and credit-building benefits of a card.

At BOBCARD, we see payments as an interconnected ecosystem: UPI for instant transactions, BNPL for short-term needs, and credit cards for planned spending and structured credit. When designed to complement each other, I think credit cards remain not only relevant but central to responsible digital finance.

• Looking ahead to 2026, should cardholders expect higher fees, tighter approvals, or smarter, more personalized experiences?
• Looking ahead to 2026, I expect everyday cardholders to see a smarter, more personalized experience, driven by data rather than blanket benefits. We’re already seeing higher engagement with category-based rewards, digital repayment reminders, and better repayment behaviour among customers who get timely nudges.

Data is also changing how we manage credit. Instead of static limits, we can now use transaction patterns, repayment consistency, and income visibility to offer dynamic limits and more relevant benefits. This lets disciplined users unlock more value, while helping newer users build credit responsibly.

For cardholders, this means fewer surprises and more clarity. Fees are more transparent, rewards match actual spending, and features are intuitive through digital integration. At BOBCARD, our goal is to use data responsibly to simplify decisions and ensure credit cards continue delivering value, convenience, and long-term financial confidence.