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RBI nod to NBFCs to issue credit cards will come with stringent conditions

NBFCs will have to meet RBI’s conditions on minimum net worth, liquidity measures and adequate cybersecurity, sources have said

February 08, 2022 / 11:20 AM IST

The Reserve Bank of India (RBI) is likely to allow some non-banking financial companies to issue credit cards but the nod will come with stringent conditions so that only those with a strong balance sheet get into the risky business, sources have said.

India is a market with low credit-card penetration of three to four percent. Banks also focus on the so-called prime or super-prime customers, making a large pool of Indians ineligible for these credit lines, which NBFCs and fintech startups are looking to tap.

“The RBI will now work on a few guidelines to operationalise this. It may set in place a minimum net worth requirement,” said one of the sources who didn’t wish to be identified.

For a company to be registered as an NBFC, the capital requirement is not too high, therefore not all such firms can be allowed to issue credit cards, sources said.