Tag: amex

Citi will shut its India retail banking business, which includes credit cards, savings bank accounts and personal loans, as part of a global decision to exit 13 markets as the US-based lender focuses on a few wealthy regions around the world.

However, the most lucrative is the bank’s credit card business, which may draw multiple bidders, according to experts.

“Private Banks and credit card companies like SBI Cards can be key beneficiaries of market share gains in the credit card segment. Some smaller private banks might be interested buyers of India portfolio as they are looking to scale-up in the segment. Foreign banks might also look to expand their presence,” a Jefferies note said.

DBS India, which want to expand in India, may be among the aggressive bidders for Citi’s credit card portfolio.

Citi credit cards

Citi started retail operations in India in 1985 and was among the pioneers of credit cards in the country. However, its share of credit cards has dropped from 13% to 6% now. Despite being the fifth-largest player in the space, Citi has the highest average spend on its card touching close to 2 lakh per card. The average spends per card for Citi is 1.4 times higher than the industry average, making it a profitable business for the bank in India. The other four major players have had nearly the same steady growth in spend per card at 11-12%.

Citibank‘s outstanding credit cards as of February stood at 2.65 million, the largest among foreign banks in India, ahead of 1.46 million by Standard Chartered and 1.56 million by Amex. Citi India had 2.9 million retail customers with 1.2 million bank accounts as of March 2020.

At the end of March 2020, Citibank served 2.9 million retail customers with 1.2 million bank accounts and 2.2 million credit card accounts.

The market

The total number of cards in circulation in India, as per a Worldline India Digital Payment report for 2020, stood at 946.81 million as of December 2020. As of December 2020, the average ticket size of credit cards was Rs 3,653, while that of debit cards was Rs 2,568, Worldline said. However, according to a 2019 report, despite being the fifth-largest player in the space, Citi boosts the highest average

spend on its card touching close to 2 lakh per card. The Indian credit card market is a fairly crowded place with 74 players operating. The top 5 players, however, have a comfortable 78% share by the number of cards and 75% share by credit card spend. HDFC bank is the leader at close to 31% share followed by SBI cards at 19%, which is trailed by ICICI, Axis, and Citi.