New debit credit card rules: How bank customers will benefit from this RBI proposal of card portability

livemint.com:

RBI, card issuers would be prohibited from entering into any arrangement or agreement with card networks that restrain them from availing the services of other card networks. RBI said it is observed that arrangements existing between card networks and card issuers (banks and non-banks) are not conducive to the availability of choice for customers.

"Card issuers shall provide an option to their eligible customers to choose any one among the multiple card networks. This option may be exercised by customers either at the time of issue or at any subsequent time," as per the draft circular.

Card network portability refers to the ability of consumers to transfer their card accounts from one network to another. Just like we can switch our mobile service providers while keeping the same phone number,  card network portability allows cardholders to maintain their existing card accounts, balances, and credit history while switching to a different payment network.  “This flexibility empowers consumers to choose the network that best suits their needs, whether it's based on factors like rewards programs, acceptance, or customer service.

It enhances competition among credit card networks and gives consumers more control over their financial choices," said Amit Gupta, MD, SAG Infotech.  The central bank has sought stakeholders' comments on the draft circular till August 4. Ranadurjay Talukdar, Partner and Payments Sector Leader, EY India said that the proposal by RBI is a significant move as it will bring wider choice to consumers, while also ending exclusive issuance arrangements that card networks have with leading issuers.