❖ SBI Card

Co-branded card port­fo­lio is ex­pected to dou­ble in the next two years by grow­ing the ex­ist­ing part­ner­ships and launch­ing new pro­grams in un­tapped cat­e­gories:

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SBI Card, in or­der to cater to the needs of di­verse cus­tomer seg­ments, has part­nered with brands across cat­e­gories of­fer­ing the most rel­e­vant and re­ward­ing so­lu­tions for the card­hold­ers. Its present card­holder base is 4.68 mil­lion cus­tomers. It has also been on a con­tin­u­ous growth tra­jec­tory over the past few years, with cus­tomer base ris­ing at 30% plus, and to­day it is the sec­ond largest card is­suer in the coun­try.

Says Vijay Ja­suja, CEO: “SBI Card’s spends too have been grow­ing steadily. We now have the sec­ond largest spends share in the in­dus­try, with monthly re­tail spends on our cards be­ing up­wards of `5000 crore.”

DI­VER­SI­FIED PORT­FO­LIO

The cul­ture of con­stant in­no­va­tion in an en­deav­our to ‘Make Life Sim­ple’ for cus­tomers is in­stru­men­tal in driv­ing SBI Card’s growth. This is re­flected in its wide range of in­dus­try first prod­ucts. Ja­suja cites ex­am­ples: “Sim­plyCLICK is a one of its kind card de­signed for to­day’s online generation, SBI Card Un­nati is a unique card tai­lored for new users in­clud­ing Jan Dhan ac­count hold­ers and those with­out credit his­tory, and SBI Card ELITE for SMES is a premium card for SME cus­tomers and many oth­ers.”

In fact, SBI Card has the largest num­ber of co-branded cards across the widest cat­e­gory spread, in the in­dus­try. In the travel and life­style space it has a strong foothold through tie-ups with mar­ket lead­ing busi­nesses and in­sti­tu­tions such as Tatas, Fu­ture Group, Air In­dia and IRCTC. In the re­tail seg­ment, FBB SBI Styleup Card is the fastest grow­ing and largest co-branded card in the coun­try.

SBI Card has had a suc­cess­ful decade­long re­la­tion­ship with In­dian Rail­ways as its ex­clu­sive part­ner and this busi­ness is also grow­ing steadily. Says Ja­suja: “We were among the first to in­tro­duce unique combo credit cards, in part­ner­ship with Mum­bai Metro and Chennai Metro, to of­fer com­muters the con­ve­nience of a metro smart card and a credit card in one. We have also tied up with var­i­ous banks to of­fer our cards to their cus­tomers.”

SBI Card and Tata Cap­i­tal have re­cently launched a unique credit card in col­lab­o­ra­tion with Star Bazaar. The Tata Star Card of­fers 3.5% value back at all Star Bazaar out­lets. The card is de­signed for cus­tomers who fre­quently make de­part­men­tal and gro­cery cat­e­gory pur­chases from or­ga­nized re­tail stores.

“We have ob­served that co-branded card­hold­ers tend to use their cards ac­tively and fre­quently, with spend and ticket sizes on the same be­ing higher than on other prod­ucts. At present, the share of co-branded cat­e­gory in our busi­ness is 15-17% and we are see­ing dou­ble digit growth in num­ber of cards as well as spends yoy. We are al­ways ex­plor­ing op­por­tu­ni­ties for fur­ther col­lab­o­ra­tions to of­fer more and more choices to our cus­tomers,” ex­plains Ja­suja.

SBI Card ex­pects to dou­ble the co-branded port­fo­lio in the next 2 years by grow­ing the ex­ist­ing part­ner­ships and launch­ing new pro­grams in other un­tapped cat­e­gories.

RIS­ING USE

A sig­nif­i­cant share of SBI Card’s cus­tomer base is from the top metro cities - Del­hincr, Mum­bai and Bengaluru. How­ever, the card com­pany is see­ing rapid growth in smaller cities such as Jaipur, Nasik, Su­rat, Luc­know, etc. Ja­suja puts the rate of growth from tier 2&3 cities higher than that of the over­all port­fo­lio and the com­pany is see­ing a grow­ing trend in queries /card ap­pli­ca­tions from such cen­ters. The SBI Card Un­nati, avail­able through 20,000 plus SBI branches, of­fers un­matched ac­ces­si­bil­ity and will en­able us to en­hance our pen­e­tra­tion in tier 2&3 cities.

Over­all, in the cur­rent cli­mate, with the gov­ern­ment’s em­pha­sis on dig­i­tal pay­ments, con­sumers ev­ery­where are be­com­ing more open to card us­age. They be­come com­fort­able with e-pay­ments and more peo­ple adopt credit cards as a pre­ferred pay­ment in­stru­ment. Ja­suja ex­pects to see sig­nif­i­cant growth from small mar­kets across the coun­try.

Vijay Ja­suja claims all credit cards from SBI Card carry a strong value propo­si­tion and of­fer at­trac­tive re­ward points on spends

E-COM TRANS­AC­TIONS

Over the last 3-4 years, e-com­merce has emerged as a key driver for growth in con­sumer spends through cards. Three years ago, less than 25% of SBI Card spends were from e-com­merce. Ja­suja ex­plains:

“Presently, online spends con­sti­tute about 45-50% of the to­tal spends on our credit cards. Var­i­ous dis­counts, cash­back of­fers and re­ward earn­ings cou­pled with ease of shop­ping online has con­trib­uted to the in­crease in credit card us­age for e-com­merce.

A unique prod­uct, Sim­plyCLICK SBI Card, through col­lab­o­ra­tions with 8 strate­gic part­ners - Ama­zon, Book­myshow, Clear­trip, Food­panda, Fab­fur­nish, Len­skart, OLA and Zoom­car - of­fers a highly re­ward­ing shop­ping ex­pe­ri­ence in all ma­jor online spend cat­e­gories. Card­hold­ers re­ceive ac­cel­er­ated re­ward points to the tune of 10X on pur­chases made on part­ner sites and 5X on all online spends on non-part­ner sites. “The Sim­plyCLICK SBI Card is a sig­nif­i­cant con­trib­u­tor to our port­fo­lio. E-com­merce is also pro­vid­ing av­enues for peo­ple to buy premium in­ter­na­tional brands in tier 2&3 cities, where peo­ple have money and as­pi­ra­tions but lack ac­cess to big city malls. We ex­pect E-com­merce spends growth to re­main strong over the next 3- 5 years,” says Ja­suja.

IN­AC­TIVE CARD AC­TI­VATED

Ja­suja points out that with pro­gres­sive reg­u­la­tory policy, gov­ern­ment sup­port to cash­less trans­ac­tions and in­creas­ing in­ter­net and smart­phone pen­e­tra­tion, the dig­i­tal pay­ments in­dus­try is grow­ing rapidly. Con­sumer ac­cep­tance of dig­i­tal pay­ments is on the rise. “Post-de­mon­eti­sa­tion in par­tic­u­lar, we have seen a new nor­mal emerge where card us­age is con­cerned. Vol­ume and fre­quency of trans­ac­tions on credit cards has in­creased, in­di­cat­ing ris­ing ac­cep­tance and us­age of credit cards by con­sumers. Us­age of credit cards for ev­ery­day spends such as de­part­men­tal store and gro­cery has risen sig­nif­i­cantly. We have also ob­served that a large per­cent­age of in­ac­tive card­hold­ers have started us­ing their cards. All this in­di­cates a shift in con­sumer be­hav­ior which will even­tu­ally be the driver for the growth of dig­i­tal pay­ments sec­tor,” says he.

Gov­ern­ment ini­tia­tives like Bharat QR, which will al­low card pay­ments at small mer­chants who do not have phys­i­cal POS ter­mi­nals, are also ex­pected to boost card us­age sig­nif­i­cantly.

For ag­ile play­ers who can adapt to the ever-chang­ing pay­ments land­scape and pro­vide mean­ing­ful so­lu­tions to con­sumers, there is tremen­dous growth op­por­tu­nity. Based on deep mar­ket in­sight and a pulse on evolv­ing con­sumer needs, Ja­suja hopes the com­pany will con­tinue to in­no­vate and of­fer rel­e­vant so­lu­tions and this will drive our growth in the sec­tor.

MIN­I­MIZ­ING FRAUDS

SBI Card is ded­i­cated to safe­guard­ing its cus­tomers’ in­ter­ests and pro­vid­ing them a safe and se­cure ex­pe­ri­ence, us­ing in­dus­try lead­ing safety fea­tures to pre­vent frauds. Ja­suja claims: “We are one of the first few com­pa­nies to have mi­grated bulk of our port­fo­lio to the su­pe­rior Euro­pay, Master­card and Visa (EMV) plat­form. These chip-and-pin cards of­fer se­cured us­age by way of man­dat­ing per­sonal iden­ti­fi­ca­tion num­ber (PIN) for ev­ery trans­ac­tion. All cards is­sued by SBI Card have added lay­ers of safety, which con­sid­er­ably re­duces risk of fraud­u­lent ac­tiv­i­ties.”

It is ob­served that one of the most com­mon ways in which fraud is per­pe­trated is by ex­tract­ing the card de­tails such as CVV num­ber, ex­piry date or OTP from un­sus­pect­ing cus­tomers. In re­sponse, SBI Card has cho­sen to go an ex­tra mile to en­gage and ed­u­cate cus­tomers on fraud, via its ed­u­ca­tional cam­paign ‘Prachar’, which sen­si­tizes con­sumers on safety as­pects of credit card us­age, schemes and tech­niques em­ployed by fraud­sters and ways to pro­tect one­self against such ac­tiv­i­ties. Un­der the cam­paign, SBI Card reg­u­larly com­mu­ni­cates with cus­tomers through var­i­ous chan­nels - SMS, email, IVR and also so­cial me­dia plat­forms.

DE­CLIN­ING DELIN­QUEN­CIES

Most cus­tomers to­day are aware of the neg­a­tive im­pact of de­fault­ing on credit card pay­ments on their credit rat­ings and are there­fore care­ful about meet­ing the pay­ment due dates to main­tain / im­prove their credit wor­thi­ness. SBI Card is see­ing de­cline in delin­quen­cies, in line with the in­dus­try. “Of late, we are see­ing a trend that peo­ple in­de­pen­dently check for their CIBIL score to keep track of their his­tory. As we move ahead, delin­quency is ex­pected to de­cline fur­ther be­cause of aware­ness to keep credit his­tory clean,” adds Ja­suja.

LOY­ALTY POINTS’ SUC­CESS

All credit cards at SBI Card carry a strong value propo­si­tion and of­fer at­trac­tive re­ward points on spends on the card. Its award­win­ning re­wards pro­gram, Shop and Smile, of­fers con­sumers over 200 re­demp­tion op­tions in­clud­ing prod­ucts, gift vouch­ers, e-vouch­ers and air miles from lead­ing brands across di­verse cat­e­gories. In or­der to de­liver greater value to con­sumers, SBI Card con­sis­tently keeps adding the best brands and most rel­e­vant prod­ucts to its cat­a­logue. Con­sumers get fur­ther value through pe­ri­odic flash deals, theme based of­fers etc. Ja­suja says: “The pro­gram res­onates strongly with our cus­tomers as is ev­i­dent in the best in class re­demp­tion rate. The pro­gram has been awarded as the Best Loy­alty Pro­gram in NBFC sec­tor at var­i­ous fora and has been very suc­cess­ful in build­ing saliency.”

Govind Sankara­narayanan, Tata Cap­i­tal (L), Vijay Ja­suja, SBI Card and Jamshed Da­boo of Trent Hyper­mar­ket, launch­ing the Tata Star Card.

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