Financial Daily from THE HINDU group of publications
Sunday, Oct 26, 2003
Financial Daily from THE HINDU group of publications Sunday, Oct 26, 2003 |
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Money & Banking
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Credit Cards & Debit Cards ICICI Bank, Fed Bank to offer co-branded card Our Bureau
Mumbai , Oct. 23 ICICI Bank and Federal Bank have signed a memorandum of understanding to launch `ICICI Bank Federal Bank co-branded credit card' and also to share their ATM networks. Federal Bank, which does not have a credit card offering as of now, will derive tremendous cost benefits out of this agreement. Federal Bank will ride on the infrastructure of ICICI Bank for the front-end and back-end processing of credit cards, with credit worthiness being evaluated jointly. This was one of the few co-branded cards between banks in India and it was ICICI Bank's first one, said Mr V. Vaidyanathan, Senior General Manager, ICICI Bank. Typically the setting up of a credit card business is a highly capital intensive one and requires an average of 4-5 years time to break even. Roughly 8 lakh `well chosen and high spending' customers can yield profits for a bank, said a private bankers specialised in the area. This business also requires credit skills and ability to lend sans a security. The ATM sharing agreement will soon enable the customers of ICICI Bank and Federal Bank to have access to the combined ATM network of about 2000 ATMs, said a press release from ICICI Bank.
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