In a bid to discourage non-serious applicants, IDFC First Bank started charging the joining fee upfront before dispatching its Mayura and Ashva credit cards. “Upfront payment of joining fee + GST required for dispatch of metal credit card. The fee is non-refundable,” IDFC First Bank said.
While the joining fee is ₹2999 plus GST (Goods and Services Tax) for Ashva credit card, it is ₹5999 plus GST, which is 18%, for the Mayura credit card.
IDFC First Bank issues a digital card before the consumer receives the card physically and activates its credit card.
“A customer can activate the card on her/his own on the bank’s portal. Cards can be activated before the physical card is sent. The card is activated after paying the joining fee, and then sent to the customer,” persons familiar with the IDFC’s updated card activation process said.
There are other activities through which the card may be activated as well; however, payment of fee is required for dispatch in the case of Ashva and Mayura Credit Cards.
“The bank has a digital application process, which is OTP (one-time password) based. Through this, the consent of the applicant is taken. Only when the process is successfully completed, the card is issued. Explicit consent is taken from the customer about the upfront payment of the joining fee while submitting the application,” they said.
The requirements for getting the card are clearly stated in the application process. Since consent is being taken after which the credit card account is activated, the process is fully compliant with RBI’s guidelines on the issue of credit cards, the persons said.
“The consent for the cards issued or the other products/services offered along with the card shall be explicit and shall not be implied,” RBI said in its master circular on credit cards. “In other words, the written consent of the applicant shall be required before issuing a credit card. Alternatively, card-issuers may use other digital modes with multi-factor authentication to obtain explicit customer consent,” the apex bank said.
Card issuers typically seek OTP-based consent if customers do not activate the credit card for more than 30 days from the day it was issued. “If the card is not activated by the cardholder for more than 30 days from the date of issuance, card-issuers shall seek One Time Password (OTP) based consent,” RBI said.
“If the cardholder does not provide consent, the card issuer has to close the credit card account within seven days of seeking consent,” RBI has said. Any request to close the credit card should be processed within seven working days if there are no outstanding dues, it said.
Allirajan M is a journalist with over two decades of experience. He has worked with several leading media organisations in the country and has been writing on mutual funds for nearly 16 years.
