Announced measures on the co-branded credit card from Fedral Bank and South Indian Bank

Federal Bank and South Indian Bank on March 13 announced measures on the co-branded credit card citing regulatory guidance received from the Reserve Bank of India (RBI), dated March 12, as per their exchange filings.

The central bank in the amended directions said for the purpose of cardholder's convenience, card transaction related data may be drawn directly from the card issuer's system in an encrypted form and displayed in the co-branding partner (CBP) platform with robust security.
“The information displayed through the CBP's platform shall be visible only to the cardholder and shall neither be accessed nor be stored by the CBP,” the RBI said.
In the amended master directions, the central bank also said the card-issuers shall not share card data (including transaction data) of the cardholders with the outsourcing partners unless sharing of such data is essential to discharge the functions assigned to the latter.

The Federal Bank in an exchange filing said the bank is in the process of rectifying the areas that are deficient and will seek regulatory clearance prior to resumption of new issuance.

Federal Bank said it has stopped issuance of new co-branded credit cards, and South Indian Bank said it shall not on-board any fresh customers in co-branded credit cards until the bank fully complies with the regulatory guidelines issued in this regard.

Federal Bank added that the bank will continue to offer credit cards to new and existing customers in the non-co-branded segment.
Both banks said they will continue to service the existing customers holding co-branded credit cards issued by the Bank. Source: moneycontrol