SBI Prunes Customer Base

SBI along with GE Finance had introduced the concept of credit cards in late 90s. However, only after a decade the company went aggressive and is still loss making due to defaults and delinquencies. SBI turned cautious and started pruning customers who have defaulted or were on the verge of it.

According to Data obtained from RBI, SBI had 2.65 Mn Credit Card users at the end of 2009. However the number has gone down to 2.26 Mn at the end of Dec-2010, a cut of 17% in its customer base.

However, the story for Debit Cards linked to Customer Bank Accounts is entirely different. The bank has 67 Mn Debit Card holders at the end of Dec-2010, compared to 51 Mn a year ago, an increase of 31%. The banks strategy off late has been to encourage customers to use Debit card and earn loyalty points which was only existent for the Credit Card customers earlier - A good move in our opinion.

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