You are the only one offering charge cards in the country as of now. What are these and whom do they work for?
The charge card offers convenience to customers who prefer to settle their bills in full each month and are averse to credit. At the end of the month when you receive the bill on your due date, you have to settle the bill in full. It also offers up to 51 days of interest-free period. So you continue to earn interest on the money in your account, unlike in a debit card, where the money is instantly debited. It’s a combination of financial discipline and value in terms of rewards points. It has a strong competitive advantage and is a smarter option compared with debit.
Not many merchants accept American Express cards, citing high commissions. Why should one go for these cards?
We look at the spending pattern of our customers. Today, if you look at India, our sense is that our merchant network accommodates approximately 85% of our card members’ general spending needs. We continue to sign in key merchants in new industry categories such as quick service restaurants, utilities, communication and supermarkets. Recently, we signed Meru cabs, Big Bazaar, Food Bazaar (to name a few) to accept our cards. Our strategy is to focus on how close we can get to capturing 100% of the card members’ spending.
These are marketed as prestigious cards to carry, but they are also the most expensive. Comment.
American Express is designed for people who want high level of benefits, services, rewards, trust and security. We are the leaders in the premium cards strategy. The reason is we ensure our customers see a lot of value. We want to make sure that all our products have real value built into them. Value that the customers get when they use various benefits, services features and other features is by far in excess to any fee they pay. Between our benefits, services, reward programme and other features, our customers see a lot of value for what they are paying.
Credit card frauds are on the rise. What precautionary measures one must take?
There are a number of in-built security features both in the card and the whole transaction chain. Customers should feel comfortable that we are protecting and guarding them against frauds.
However, customers should keep certain things in mind while choosing a card: What is their liability in case they lose the card or when there is a fraud? What is the replacement policy of the card issuer? In American Express, if a customer loses a card there is a zero card liability for the customer for the transactions that happen after they report the card. In case there is any online fraud, the customers are protected with zero fraud liability.
Of course, we need customers to take due care. Also, if they lose their cards, then we pretty much make an immediate replacement free of cost.
When you get your card, you should sign on it immediately. Don’t keep charge receipts, which may have your credit card number, lying around. Be careful when you give your credit card number on the phone or on the Internet, ensure the sites are secure. Also if you feel uncomfortable about a transaction, you should immediately contact the issuer.
You have been aggressive in the premium space. Would it remain your focus?
We see a number of growth opportunities in our current line of payment products as well as the new segment. In our premium lending segment, we have our platinum card. We see there is a segment out there which is into frequent travel and flying, so our co-brand card with Kingfisher helps us meet the needs of that segment. We have the charge cards. We have corporate cards that meet the needs of various corporate sizes. We continue to look at opportunities such as the pre-paid market space.
Shailesh Baidwan, Country manager and head (consumer cards), American Express Banking Corp., India