Banks to Issue Mobility Enabled Cards: The government has asked banks to ensure that all new cards and reissue of old cards are issued with the National Common Mobility Card (NCMC) as the default option with contactless or near-field function features. NCMC).
New Delhi: RBI is changing the rules to stop the dominating international card network in the debit-credit card sector and to expand the domestic Rupay card network. In the past, the RBI had asked the banks to give the customer the option of more than one card network provider when issuing the card. Now the government has directed the banks to issue National Common Mobility Card to the customers. This change in payment card network is being done for expansion of Rupay network.
The government has asked banks to ensure that all new cards and reissue of old cards should have the National Common Mobility Card (NCMC) as the default option with contactless or near-field function features. The communication sent earlier this month will prompt banks to issue more cards on the RuPay platform, as most of the NCMC enabled cards are on the RuPay network.
A senior official confirmed the matter and said that banks and lenders are expected to equip all their cards with NCMC facilities including offline wallets. Explaining the motive behind the recent directive, he said that it has been observed that most of the lenders including private and public sector banks are not issuing NCMC cards with NFC functions.
In a circular issued in early July, the RBI had said that banks and card network providers such as Mastercard, Visa and American Express cannot be involved in card issuance arrangements. Presently the card providers are linked to the banks and thus the customer does not get a chance to choose the desired card provider. This causes loss to the consumer.
What will change with the change in card network?
Domestic card network RuPay was launched in the year 2012. At the same time, the latest circular of RBI on debit and credit cards can prove to be helpful in loosening the hold of international card networks on India. This will help in making India self-sufficient in the payment system. The new rule will clear the market for the government’s RuPay card, which is now cornered by big international players like Visa and Mastercard. This will end the dominance of foreign companies.
