Credit Card Portability: Know It’s Benefits

We are all aware of mobile sim card portability, which is the process of easily changing a mobile service provider if we are unhappy with the current service provider for any reason. Similarly, Indian citizens can now port their credit card networks

The Reserve Bank of India has announced credit card portability services from 1st October 2023. By availing of credit card portability service, the hassle of reapplying for a new credit card and going through the entire application process again is eliminated.

Credit card users faced a lot of limitations earlier when they wished to change their credit card network, and it was also expensive to do so. Now, as credit card portability has emerged as a solution, users will have the benefit of reduced costs and enhanced customer services as credit card providers will do everything to retain their customers. Users can also choose their preferred credit card that resonates with their financial goals and requirements.

This article will bring more clarity on credit card portability and its importance.

What is a Card Network?

A card network is a financial infrastructure that connects financial transactions and communication between cardholders, credit card issuers, and merchants. A card network aids in credit card authorisation and transactions. The National Payments Corporation of India (NCPI) has developed card networks in India, such as RuPay, American Express, Visa, MasterCard, etc.

What is a Credit Card Network Portability?

When you change your credit card provider and transfer your credit card account from one bank to another, it is known as credit card network portability. You can port your credit card without needing to change your credit card number, which is useful if you prefer a new credit card issuer’s services and benefits and wish to change your credit card provider but want to avoid the hassle and expense of applying for a new card.

Importance of Credit Card Portability

Credit card portability is an important feature associated with credit cards:

• It gives the customer flexibility to choose their preferred card network.
• Customers can easily switch their credit card networks to avail more benefits and tailor-made experiences.
• It allows customers to opt for a bank that has partnered with their preferred card network, as customers cannot select the card networks themselves.

Why is Credit Card Portability Beneficial?

Credit card portability offers many benefits:

• Customers can change their credit card network anytime.
• Along with credit cards, customers have the chance to select their preferred card network.
• Customers can evaluate all the terms and conditions, and offers of various cards and opt for one that benefits them the most.
• Customers can choose a card that suits their lifestyle and spending pattern and avail of maximum cashback and offers.

When Should You Choose for Credit Card Portability?

When you change your credit card network, you have to deal with a new card provider and their customer services. So, make a well-informed decision and opt for credit card portability when:

• Changing lifestyle: Your lifestyle will change and evolve year by year, and so will your spending. So when you feel your spending pattern and lifestyle will be better served with a new card network, you should choose credit card portability.
• Better rewards: If another card network provides more benefits and offers, you should consider porting your credit card.
• Reducing interest burden: If you are paying a higher interest rate and want to reduce the interest cost, port to a card network that provides low interest rates.

Can I Switch from One Bank to Another?

No, it is not possible to switch from one bank to another. You can only port your credit card networks. You cannot switch banks as banks issue credit cards based on your credit history, spending pattern, and your relationship with the issuing bank. If you change the bank, these criteria may be different, and your customer history and privileges will not be established as you will be a new customer.

What are the Positive Changes of Credit Card Portability for Consumers?

Some of the positive changes of credit card portability for customers are:

• Customers have the option of selecting their preferred credit card network.
• There is more flexibility, and it is easier to manage credit cards with a credit card portability option.
• As portable credit cards create healthy competition amongst credit card networks, their services will improve.
• Since credit cards are now linked with UPIs, it enhances the customer experience.
• The issues faced by customers while travelling internationally are resolved.

Frequently Asked Questions

1. What is the provision for the prohibition of restrictive agreements by the RBI?

   One of the critical provisions of RBI for credit card portability is to restrict cardholders from utilising other card network services. This ensures more flexibility and access for customers.

2. Can card issuers issue more than one card network?

   Yes, card issuers can issue more than one card network.

3. Can I convert my credit card to RuPay?

   Yes, it is easy to switch to a RuPay credit card if you are currently using a Visa or MasterCard. You need to contact your bank’s customer service officer to initiate credit card portability. You can also request a new card from your bank’s branch.

4. Can I convert a credit card?

   When you upgrade your credit card, you swap your existing credit card for a new card with the same issuer. In doing so, you can keep your current card and account number.