RBL Bank Ends Partnership with Bajaj Finance for Co-Branded Credit Cards

RBL Bank has announced the conclusion of its long-standing partnership with Bajaj Finance for co-branded credit cards. This strategic decision marks the end of an eight-year collaboration that began in 2016 and significantly contributed to the bank’s credit card growth. Despite this change, RBL Bank assures customers of uninterrupted services for the existing portfolio of approximately 3.4 million co-branded credit cards.

No Impact on Growth Strategy

RBL Bank has emphasized that the move will not affect its overall credit card business growth. Jaideep Iyer, Head of Strategy at RBL Bank, stated, “We are looking at growing the cards book. This does not materially change our card acquisition strategy. We have put in place new co-brand partnerships.”

The bank’s credit card advances reached ₹17,538 crore in Q2FY25, reflecting a robust 17% year-on-year growth. It plans to continue exploring new avenues, including collaborations with financial and consumer brands such as Mahindra & Mahindra Finance, TVS Finance, Indian Oil Corporation (IOC), and IRCTC.

Seamless Transition for Customers

Customers using Bajaj Finance co-branded credit cards will continue to enjoy the same benefits and rewards. Upon renewal, these cards will be reissued under RBL Bank’s branding, ensuring a smooth transition and consistent customer experience.

Reduced Dependence on Bajaj Finance

Over the past year, RBL Bank has lowered its reliance on Bajaj Finance for sourcing co-branded credit cards. The issuance of new cards through this partnership declined from 1.26 lakh in September 2023 to 37,000 in September 2024.

At its peak, the Bajaj Finance partnership accounted for up to 75% of RBL Bank’s credit card sourcing in 2020. However, the bank has diversified its strategy in recent years, expanding its issuance capabilities via direct channels and new co-branded partnerships.

Focus on Cross-Selling

Beyond growing its credit card portfolio, RBL Bank is increasingly focusing on cross-selling products to its existing cardholders. “Our excitement is more towards how we can cross-sell our products to card customers, and we are already beginning to do that,” Iyer noted.

Expanding Credit Card Footprint

RBL Bank had 51.74 lakh outstanding credit cards as of October 2024, underlining its strong presence in the credit card market. By enhancing its direct issuance capabilities and forging new partnerships, the bank aims to sustain and grow its leadership in the sector.

This strategic pivot reflects RBL Bank’s commitment to a diversified and customer-centric approach, ensuring seamless service while positioning itself for sustained growth in the dynamic credit card industry.