How equipped is Hylobiz to implement RBI’s credit card directions?

The fintech industry has gained popularity in the last 5 years as it is catalyzing the automation of the financial system with the strength of technologies.

Many fintech companies offer credit card-like products and get into an arrangement with Issuers to offer co-branded credit cards. 

Credit card frauds and customer harassments related to debt recovery are very common these days. The RBI rules aim at protecting customers’ transactional data as there were a number of cases of misuse of data, data breaches, and data theft in recent years. The new credit card rules seem to be customer friendly and will be able to provide high-end security to credit card users. 

However, there are rumors in recent days about the instability that fintech companies may experience due to RBI’s new directions for the Credit Card industry.

Why do some fintech companies assume the new RBI rules might pose threat to their business?

A veteran in the banking industry shared on conditions of anonymity,

“RBI would surely through its new guidelines bring the financial sector in control.”

The Reserve Bank of India on 21st April 2022, has issued new guidelines (known as Credit Card and Debit Card- Issuance and Conduct) for credit and debit cards effective from 1st July 2022.

Credit card rules which might be of concern to some fintech companies
  • Only banks like SCBs and RRBs with a net worth of Rs 100 crore can issue credit cards to customers who have written consent and should mention every charge detail on the key fact statement.
  • Banks can issue co-branded credit cards and there is no need to seek permission from RBI, but the co-branding partners cannot claim the card as issued by them but are limited to marketing and distributions.
  • Banks are not allowed to share the customer transaction data with their cobranded card partners.
  • NBFCs cannot do credit card businesses without the nod of the Reserve Bank of India. NBFCs should have a net.
    owned fund of INR 100 crore to take explicit permission from the Reserve Bank of India in this regard.
  • The card limit sanctioned to the cardholder should not be breached in any case.
Reasons for concern
  1. Although many top fintech companies treat customer data security as a top priority, they use transactional data with partner banks. These data are analyzed by fintech to offer personalized solutions for customers. RBI’s directions prohibiting transactional data access for customer sourcing partners might put Fintechs at a loss.
  2. The rising credit card debt trap due to misselling by unregulated fintech companies is a serious concern. Since the card issuers such as banks and NBFCs, can issue cards with prior permissions from the RBI, many card focused fintech firms would now tend to seek NBFC licenses to stay in business.

A fintech counselor did not want to disclose identity while sharing,

“a fintech with top-grade services through advanced customer-friendly technologies and with transparency at the core will win over the situation and continue rendering services.”

Hylobiz is equipped to follow RBI’s guidelines

Hylobiz, a leading fintech startup is supporting the B2B value chain with digitization, and business process automation. We are progressive, innovative, transparent, and disruptive in the true sense.

Yes, we provide easy access to financial products via partner banks. You might be wondering if the Reserve Bank of India directions would hit our services. Allow us to clarify. 

Hylobiz is pre-integrated with multiple top ERPs and has partnered with multiple banks and NBFCs.
Any business registering on Hylobiz can easily integrate their existing accounting platform and bank account via APIs. 

Visit to understand our SME offerings:

Businesses get easy access to capital from our partner FIs. The financial institutions showcase their products like business loans, pre-approved credit cards, and several connected banking services on our financing marketplace which is available on financing feature on the web portal and mobile apps. The connected ERP and connected banking-based value-added services on Hylobiz ensure increased customer engagement and satisfaction. Unlike some fintech companies, Hylobiz does not act as a customer acquisition channel for partner banks, nor does it drive transactions through technology to the partner banks, which is against RBI’s perspectives on customer data security. In the case of lending, the financial institutions handle such transactional data. We don’t store customer data. HyloBiz acts as an enabler for its partner Banks while catering to the customer ecosystem without actually substituting the Bank’s role, in line with the expectations set out by RBI.

We analyze our registered customers’ business profiles based on the transactions they do on the platform. Top-notch security of bank-grade is what customers can experience at every level on the platform. The platform is ISO certified and secures data with strong encryptions and multi-level authorization. Clearly, we are equipped to implement RBI’s credit card rules.

Read our blog on pre-approved credit cards:

About Hylobiz- the all-in-one automated solution.

We are a fintech not just focused on the credit card business. Our main aim is to automate and streamline essential processes in enterprises across all industries and verticals.

Top features at a glance.

We support invoice and inventory management, payments, collections, auto reconciliation, cash flow visibility, working capital efficiency, and a lot more. The platform tracks AR/AP and automates your business cash flows. The shareable digital ledgers give businesses transparency at the core and our system is transparently backing that up. The automated reports, business health score, and real-time dashboard enable you to make informed decisions on the go. And you get all of these at zero installation charges and at zero second downtime.

You can now comply with  GST Council’s E-Invoicing mandate on Hylobiz- powered by Vayana-GSP, India’s largest GST Service provider. Stay tuned as we come up with more feature updates in just a few days to come.

Read our blogs to learn about our product features.

Once you visit the platform and read through our offerings and blogs, you may book a free demo to understand how the Hylobiz platform can support your business. We urge you to take a prompt decision to make use of the tailor-made solution. You will get access to technology and automation to ease all your business needs and easy credits for a good cash flow. 

Success and growth are on your way! 

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