Citibank jumps into card war

The recently-triggered price war in the Indian credit card market is all set to benefit more than 24 lakh credit card customers of Citibank. The bank, in a swift response to the price war, has announced an interest rate of 1.5 per cent per month on its existing credit cards under the ‘‘Dynamic Differential Interest Rate Programme’’.

The interest rate on the card will be based on usage and payment patterns of customers and it would be reviewed every 90 days and could change depending upon the changes in customers, Citibank’s cards business manager T. R. Ramachandran said.

Citibank, in its monthly statement to the customers said, ‘‘Effective now, your card interest rate will be based on usage and payment patterns and is subject to periodic review.’’

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This is about 50 bps lower than the minimum rate of 1.99 charged on the recently launched differentially priced credit card, Manhattan, by rival Standard Chartered Bank. This rate is not applicable to StanChart’s existing cards.

Pricing cannot override the inherent and specific financial, convenience and lifestyle needs of the various segments, Ramachandran said.