The asset quality of HDFC Bank’s credit card portfolio remains stable and it is not seeing any stress in the segment, Parag Rao, country head – payment business, consumer finance, technology and digital banking at the private sector lendor said on Thursday.
“We continue to monitor our portfolio on a regular basis. But as we speak, we do not see any stress on our portfolio,” Rao said.
His comments come at a time when Reserve Bank of India’s (RBI) latest Financial Stability Report showed that while there was an overall improvement in the asset quality of personal loans, impairments in the credit card segment rose slightly.
The report showed that credit card bad debt doubled among state-owned banks to 18% in 2022-23(April-March).
The data comes amid buzz that Reserve Bank of India (RBI) is uncomfortable with the spike in unsecured loans in the overall banking system.
While Rao declined to comment on the likelihood of any intervention by the central bank, he acknowledged that there have been “discussions” on the spike in stress in unsecured lending.
“The bank has always been prudent in its approach and has not changed its underwriting standards,” he said.
On Thursday, HDFC Bank announced that it has partnered with Mariott International’s travel programme Marriott Bonvoy to launch Marriott Bonvoy HDFC Bank Credit Card.
The Marriott Bonvoy HDFC Bank credit cardholders can earn Bonvoy points on eligible spending.
The rewards include one free night award worth up to 15,000 points to be redeemed for a one-night stay at participating Marriott Bonvoy hotels.
Cardholders can earn up to three additional Free Night awards upon meeting spending thresholds.
Rao said that the bank will continue to look at categories where they see customer spending and get the best out of co-branded partnerships. While the bank has around 17-18 million cardholders, the customer base is over 100 million following the merger of Housing Development Finance Corporation with HDFC Bank.
The bank’s credit card portfolio will continue to grow at 25-30% in 2023-24(April-March).
Additionally, Rao said that the bank is witnessing “good traction” on the unified payments interface for credit cards.
