SBI cards-the third largest player in the credit card segment-has invited applications for finding a new partner as GE is set to exit the space.
"We have floated the RFP (Request for proposal) document and are hoping that the process will be completed by mid-January 2016," said an official directly involved in the process. He also added that they have seen initial interest coming in from corporate, banks and one IT processing country.
SBI Cards is a joint venture between country's largest lender-State Bank of India and GE Capital. GE capital is set to exit the space as a part of its global business restructuring policy whereby they have decided to exit the finance business. SBI had entered the credit card business in 1998 by tying up with GE capital.
The partnership works through two joint ventures, SBI Cards & Payment Services and GE Capital Business Process Management Services. While SBI Cards & Payment Services takes care of the front end of the business, GE Capital Business Process Management Services is responsible for the management of technology and processing. GE Capital owns 40% in the SBI Cards & Payment Services and 60% in GE Capital Business Process Management Services.
As per the Reserve Bank of India data, the total number of outstanding cards with SBI was at 3.36 million in the month of August. HDFC Bank has the largest share in the segment, with the total number of outstanding cards at 6.48 million, followed by ICICI Bank at 3.39 and then SBI.
During the April-June quarter, SBI Cards & Payment Services posted a 46% decline in net profit at Rs 62 crore as compared to Rs 114 crore in the same period a year ago.
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