RBL Bank has confirmed its ongoing partnership with Bajaj Finance for co-branded credit cards, a relationship that currently represents around 48% of RBL’s co-branded credit card portfolio.
Strategic Shift Towards Diversification
- While this partnership remains crucial, RBL Bank is planning to reduce its dependency on Bajaj Finance by shifting focus to a branch-led model. This strategy will involve targeting existing customers and expanding through other channels.
Regulatory Concerns Addressed
- There were reports in December last year about concerns raised by the central bank regarding the co-branded partnership between RBL Bank and Bajaj Finance. The partnership’s contract was extended for just one year, with the current agreement set to expire in December 2024.
De-Risking Strategy in Play
- To mitigate risks, RBL Bank is investing in its branches and increasing branch-led credit card issuance. This move will gradually reduce the concentration of their credit card portfolio with Bajaj Finance, though the partnership remains a vital component of their strategy.
Expanding Partnerships
- In recent months, RBL Bank has onboarded more co-branded partners, which will now play a more significant role in their credit card issuance strategy, ensuring a more balanced and diversified approach.