Mastercard Ban Drives A Partner – And Customers – To Visa
RBL Bank said on Thursday it has signed up Visa Inc for its credit cards, a day after central bank decided to bar rival payments company Mastercard Inc from issuing new debit or credit cards in the country.
The lender aims to issue new credit cards under the Visa network in 8 to 10 weeks following a technology integration.
RBL shares fell as much as 3.2% after it warned that card issuances per month will be impacted until then as it awaits updates on issuing new credit cards with Mastercard.
The Reserve Bank of India had on Wednesday barred Mastercard from issuing new cards to domestic customers for violating data storage rules from 2018 that require foreign card networks to store Indian payments data “only in India”.
The ban takes effect on July 22. The RBI said its decision will not impact existing Mastercard customers.
Mastercard said it was “disappointed” with the decision and that it had provided regular updates on its compliance with the rules since 2018.
RBL Bank has around three million credit card customers and is the fifth largest credit card issuer in the country with a 5% market share, the bank said in a statement.