New debit credit card rules: How bank customers will benefit from this RBI proposal of card portability

In a pioneering move, The Reserve Bank of India (RBI) has introduced a draft rule that empowers debit, credit, and prepaid card users to select their preferred card network, marking a potentially groundbreaking development worldwide. This rule challenges the existing practice where card network options are predetermined by agreements between issuers and networks

RBI draft proposal on debit, credit cards

According to a draft circular by RBI, card issuers would be prohibited from entering into any arrangement or agreement with card networks that restrain them from availing the services of other card networks.RBI said it is observed that arrangements existing between card networks and card issuers (banks and non-banks) are not conducive to the availability of choice for customers.

Card network portability refers to the ability of consumers to transfer their card accounts from one network to another. Just like we can switch our mobile service providers while keeping the same phone number,  card network portability allows cardholders to maintain their existing card accounts, balances, and credit history while switching to a different payment network. This flexibility empowers consumers to choose the network that best suits their needs, whether it's based on factors like rewards programs, acceptance, or customer service. It enhances competition among credit card networks and gives consumers more control over their financial choices," said Amit Gupta, MD, SAG Infotech. 

Card network portability refers to the ability of consumers to transfer their card accounts from one network to another. Just like we can switch our mobile service providers while keeping the same phone number,  card network portability allows cardholders to maintain their existing card accounts, balances, and credit history while switching to a different payment network. This flexibility empowers consumers to choose the network that best suits their needs, whether it's based on factors like rewards programs, acceptance, or customer service. It enhances competition among credit card networks and gives consumers more control over their financial choices," said Amit Gupta, MD, SAG Infotech.