HDFC Bank's Parag Rao On Rationale Behind Introducing A Credit Card For SME Businesses | NDTV Profit - video Dailymotion

NDTV Profit

- Rationale behind introducing a credit card for SME businesses - Communication from #RBI regarding #Paytm's nodal account and more   Watch #HDFCBank's Parag Rao in conversation with Pragatti Oberoi.

Transcript

00:00 We're here in Mumbai where HDFC Bank has launched a new range of credit cards specifically for

00:04 business.

00:05 Joining us for the conversation is Mr. Parag Rao.

00:07 Sir, thank you so much for taking out the time and talking to us.

00:10 Thank you.

00:11 So a new range of credit cards specifically for SMAs.

00:14 So I want to first start by understanding the rationale behind this launch.

00:17 Were you seeing a new set of demand coming up?

00:20 Okay.

00:21 So we actually launched our initial version one of the business card range, only two variants

00:27 about two to one half years back.

00:30 That point of time we said two things.

00:32 Let us give an offering to a generic offering to the business community.

00:38 We deal with the business community or the SME segment if you may call.

00:41 So through two means all our asset businesses deal with them and of course our merchant

00:45 acceptance business.

00:47 And we said let's launch it.

00:48 They don't have a payment product.

00:50 Can we launch a payment product and learn from this space?

00:52 So we built up a portfolio of approximately 3.7 million cards and frankly speaking I think

00:59 the results are very encouraging in terms of the engagement expense.

01:03 But then one of the outcomes of this experience was to realize that the SME segment cannot

01:08 be treated as one.

01:10 There are multiple segments really coming out.

01:13 The needs of them are differing and diverse and so we said there is a time now to evolve

01:18 our product.

01:19 Try to create more segments and can we have a customized offering so that we can address

01:25 their needs even better.

01:27 And hence the birth of the new range of products.

01:30 These are steeped in a lot of learnings over the last two to one half years on our existing

01:35 portfolio and we realized that like I said a self-employed professional has a different

01:40 need from say a trader to a person who is in the services business or one who has a

01:45 small manufacturing setup.

01:46 And hence the objective of this range is to really further deepen our relationship

01:50 with them and give them very specific benefits tailored to their needs.

01:55 Thanks so much for the clarity.

01:56 Sir, the payments ecosystem or the FinTech ecosystem is a little wobbly at this point

02:01 with the recent thing that has happened with Paytm Payments Bank and 197 Communications.

02:08 So you already have a co-branded credit card with Paytm.

02:12 What happens to that?

02:14 As of now nothing happens to that.

02:16 That continues.

02:17 But we are watching the situation as it evolves.

02:21 Fair enough.

02:22 Sir, has also there been any communication from the RBI about Paytm's nodal account

02:27 with your bank?

02:28 Really would not like to comment on that at this point and say it would be inappropriate.

02:34 If in general if you have to look at the whole payments business and the cards business also

02:39 with the recent thing that has happened with Paytm and do you see this as an opportunity

02:45 for other banks and FinTechs to grow or would there be a surge in demand in certain products

02:51 where banks and FinTechs would start capitalizing on that move?

02:56 Generally speaking in any industry if you see that maybe one or two players either change

03:04 their strategy or you know sort of reduce their business.

03:08 I mean customers are smart today they move to other service providers.

03:11 I see some of that happening already.

03:13 Some of the newspaper reports also say that.

03:16 But that's only natural.

03:19 And NCMC, do you think that as a product will start getting more traction for banks going

03:25 forward?

03:26 Well NCMC is the NPCI protocol specifically designed for tolls, transit, smart cities

03:34 etc. etc.

03:36 It's already available in many of the metro projects as we speak, the large ones.

03:42 And as automation and digitization sort of spreads across the country and you know that

03:47 there are practically every city now has a metro project either up and coming or planned.

03:54 I see the need for NCMC cards in the hands of customers growing as significantly as more

04:00 and more people use these public utilities.

04:04 Okay so you see that growing going forward.

04:07 And one last bit on this part.

04:10 Because there's general consensus because the reputation and trust factor is a little

04:15 wobbly now on after what has happened with Paytm and now merchants are also a little

04:19 worried.

04:20 That's a general sense that we are picking up from the market.

04:22 Are you seeing an increased demand or a switch happening from the merchant side?

04:26 Are they coming more to HDFC for perhaps the soundbox or any other product?

04:32 Well like I said earlier when something happens to one player for whatever reason etc. customers

04:39 are smart they sort of move to other service providers.

04:41 We've seen a little bit of uptake in the last one week of merchants coming to us.

04:47 On which particular platform?

04:49 On the Byapaar platform, our digital merchant acceptance platform.

04:54 Thank you so much for talking to us.

04:55 It was a pleasure having you.

04:57 [Music]

HDFC Bank's Parag Rao On Rationale Behind Introducing A Credit Card For SME Businesses | NDTV Profit

Category

Transcript

Recommended