HDFC Bank will double to US$1.90 the fee it charges on cash payments made to settle credit card bills starting November 1.
The bank currently charges a processing fee of US$0.95 for every credit card repayment made in cash at its branches and ATMs. Bank officials said the reason for the increase is the extensive manual work involved in branch-level transactions.
The move to hike these fees is also in line with a strategy to encourage customers to do business online and reduce cash handling and related transaction processes at branches and ATMs.
HDFC Bank is India’s largest issuer of credit cards with about 5.6 million customers or some 32% of the overall market of 17.6 million. About a third of all credit card users make cash payments. Last fiscal year, credit card users spent an average US$1,046 or almost three times the US$360 spent five years ago.
HDFC Bank, which is also India’s second largest bank by market capitalization, has a network of more than 2,500 branches and over 9,000 ATMs across India.
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