Credit Card Issuers had the authority to choose their card network. Customers had no choice since credit card issuers have agreements with these networks to offer some benefits. However, Six Months from Now, customers will have the option to choose a Card Network. This may be both beneficial or a loss for the cardholders.
How does this work?
There is no clarity on how the whole thing will work. I mean, yes, you can choose from any of the following card networks, but there are still some questions that remain to be answered:
- Mastercard
- Visa
- RuPay
- American Express
- Diners Club
For all new credit cards issued after Aug’24, the cardholder can choose from any of the above networks except if your card issuer is American Express since it is both a card issuer and a card network.
Is this change good?
In a world where many don’t even understand their card’s benefits, they will now have to work on another thing—their card network.
I mean, Mastercard and Visa & Diners Club have different variants. It will also be interesting to see which network variant will be available. For Example, Mastercard World Elite is the topmost Mastercard variant, and Visa Infinite is of Visa. However, I don’t think any bank would offer World Elite instead of Visa Infinite. So, now you would have to figure out which card network and its variant is good for you. Some standard benefits can be across the cards, but higher variants give more benefits.
Why is this being done?
Based on the notification, this is being done to provide more choices to customers as the agreements were restrictive. However, RBI may have considered other things.
Can you Choose a Card Network for all credit cards?
An exception has been made to choose a card network. Any card issuer with less than 10 Lacs active credit cards will still be able to have a standard Card Network. Also, existing cardholders can choose a card network when renewing their card.
Bottomline
Starting August 2024, you will be able to choose your network when applying for a new card. For existing cards, this can be done when renewing. RBI’s initiative to let customers choose their card variant is good; however, not everyone will be able to choose the right card network for themselves.
