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Citi India Debit, Credit Cards Users: What Will Happen to You After Axis Deal

By: Mohammad Haris

News18.com

Last Updated: March 30, 2022, 20:06 IST

Citi India will sell its consumer business to private lender Axis Bank

Citi India will sell its consumer business to private lender Axis Bank

With Axis Bank on Wednesday announcing to acquire Citibank's consumer business in India, it will effect churning of Citi India's retail customers to move to Axis Bank. Here's what you need to know about the deal and its impact.

With Axis Bank on Wednesday announcing to acquire Citibank’s consumer business in India, it will effect churning of Citi India’s retail customers to move to Axis Bank. Citigroup Inc said it would sell its Indian consumer businesses to the private lender for a cash consideration of USD 1.6 billion (about Rs 12,100 crore). Axis Bank said services and features will remain the same for customers. Here’s what debit and credit card customers need to know about the deal and its impact:

Citi Credit Card Users: What’s the Next Step

According to the RBI’s latest data, the total number of Citi credit cards in India stood at 2.55 million. Through these credit cards, Rs 3,555 crore worth of transactions took place during the month, including Rs 6.7 crore via ATMs. The total number of its debit cards stood at 1.44 million. Citi India also has 1.2 million loan accounts.

Speaking with reporters on Wednesday, Axis Bank Group Executive – Banking Operations & Transformation Subrat Mohanty said the current benefits and features of the credit cards and other services will remain the same for the customers or they will be enhanced.

Its Managing Director & Chief Executive Officer Amitabh Chaudhry said, “Hopefully, they (customers) will not see any change with the people they interact and customer experiences, and will have access to wider products after the transition is complete."

On customers’ overlap, he said exact data is not there but it will not be a large number.

Will Citi customers become Axis customers?

Yes, after the transition is over, Citi customers will onboard Axis Bank. “The customers will have access to Axis Bank technology and wider offerings," Chaudhry added.

Transition Period

The transition period will be 9-18 months with a flexibility of an additional six months. The Citi customers will be gradually shifted to Axis Bank platform in a gradual manner. “A team for the transition is already in place," the MD & CEO said. The total cost of transition will be close to Rs 1,500 crore, and out of this, Rs 1,100-1,200 crore will be paid by Axis Bank.

Will there be KYC afresh?

Yes. “Re-KYC is the requirement of the regulator. It happens periodically. We will need consent of a ‘particular kind’ in the transition processes before the date of closing (within 18 months)," Chaudhry said.

What About the Branches?

Branches will remain the same. “They are at prime locations and we would keep them to serve customers," the MD&CEO said.

Citi-Axis Bank Deal: What all Segments to be Transferred?

Credit cards is the major portion of the deal. Apart from this, personal wealth management like portfolio managing and retail customer accounts segments will be transferred from Citi India to Axis Bank.

Business related to financial portfolio management will also be given to Axis and now, Citi customers will deal with Axis on this. Citigroup had entered India in 1902 and started the consumer banking business in 1985.

Axis in a statement said, “It will gain access to the large and affluent customer franchise of Citibank having a bouquet of fee-oriented and profitable segments, that include quality credit card portfolio, affluent wealth management clientele, meaningful deposits with 81 per cent being CASA, along with a strong consumer lending portfolio. Post the acquisition, Axis Bank will have 28.5 million savings accounts, over 2.3 lakh Burgundy customers and 10.6 million cards."

Citi in other Countries

In April 2021, the group had announced its intention to exit consumer businesses in 13 countries, including India, as it focuses on four wealth centres in Singapore, Hong Kong, the United Arab Emirates and London.

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first published:March 30, 2022, 16:30 IST
last updated:March 30, 2022, 20:06 IST