ABN AMRO Bank & MakeMyTrip.com launches ‘GO’ travel card

From the Moneycontrol.com

ABN AMRO Bank and MakeMyTrip.com today announced a partnership to launch a co-branded Travel Credit Card ‘GO’. This travel card promises to be a unique offering and will provide a wide range of domestic and international travel services as well as offering exclusive promotions around airlines, hotels and holiday packages.

The Card is powered with ‘GO Miles’, an exclusive rewards program, which gives the user an option of redeeming their reward points against any airline ticket to any destination or stay at any hotel. Also the accelerated rewards advantage helps users to earn higher rewards on transactions made on MakeMyTrip.com.

Speaking on the occasion Mr Sumant Kathpalia, ABN AMRO’s Head of Consumer Banking in India said: “Indians are increasingly using online services to plan their travel and book their tickets. Our tie-up with MakeMyTrip.com to launch the co-branded credit card further helps in our outreach to more customers in one of the fastest growing spend categories - travel. This tie-up leverages both ABN AMRO Bank’s ability to provide creative solutions for customers’ increasing spending needs and MakeMyTrip’s market leadership position in the rapidly growing online travel industry. This launch is in line with our constant endeavour to respond to the ever-evolving needs of our customers, who are increasingly demanding solutions that add value to combine leisure and entertainment with functional products such as credit cards.”

Commenting on the synergies of this association, Mr. Deep Kalra, Founder & Chief Executive Officer at MakeMyTrip.com. said: “We firmly believe that innovation is the key to maintaining our market leadership and customer satisfaction. We are delighted to be launching this payment solution with ABN AMRO, a partner who complements our passion for innovation and unsurpassed customer service.”

Mr. Sachin Bhatia, Co-Founder & Chief Marketing Officer at MakeMyTrip.com added: “E-commerce is projected to more than double to Rs 5,500 crore this year from the last, and travel will make up a huge chunk of it. MakeMyTrip acknowledges the need for a payment solution that addresses the evolving needs of travellers and rewards them with relevant incentives. We have created such a solution with our partner, ABN AMRO, and are confident that Indian travellers will take advantage of this compelling proposition that will make their travel a simpler and more rewarding experience.”

MakeMyTrip.com is the largest online travel portal in India. It offers a comprehensive host of travel services including; flights, hotels, vacations and cars

Cards aren't for credit alone

With the demand for card payments on the rise, banks have hit their innovation buttons to offer a card for almost every conceivable need today. The latest offerings range from cards for shopaholics like women, offering reward points for purchases beyond a certain sum, to those that help overseas travellers avoid the hassles of currency exchange.


What's more, as an alternative to the meal coupons issued by companies to their employees, at least one bank has started offering a card that obviates the need to carry and count out coupons of various denominations.

One might wonder why so many special cards are being launched, when a single credit card could suffice. But, these new offerings indeed offer benefits that regular credit cards don't.

Take for example, the ForexPlus card offered by HDFC Bank or the Travel Card from ICICI Bank. The cards, both pre-paid, help a person travelling abroad avoid having to exchange rupees for the currency desired, at least to the extent card payments can be made. The traveller can take a pre-paid card by paying in rupees, but make card payments in a currency relevant to the country he is visiting.

The HDFC Bank card can be used to pay in US dollar, euro and pound sterling, while ICICI Bank's card serves for Australian dollars, Canadian dollars and Swiss francs, besides the three currencies of its rival. Among other special features, HDFC Bank offers an overseas insurance cover to the cardholder, while ICICI Bank claims to offer an SMS alert for every purchase made using the card.

HDFC Bank offers a few unique benefits on its Women's Gold card. Having realised that women are shopaholics, it offers 5 per cent cash back on grocery purchases without any upper limit. Also, for every Rs 100 spent above Rs 5,000 in a month, the cardholder gets 5 reward points.

The reward points, in turn, can be utilised for more shopping, ranging from durables like microwaves and refrigerators to fashion brands.Taking innovation a step further, HDFCBank offers a pre-paid FoodPlus card to which employers can directly credit the food voucher amount due to an employee. Not only does the card help save the employee the bother of carrying a bundle of food coupons every time he eats out, but also accounts for small change, unlike in food coupons. Also, one doesn't need to collect the vouchers from the employer each month and keep track of where he spent them - one look at the account statement tells all.
All these cards come with the option of cash withdrawal from the respective bank's automated teller machines, though one should avoid cash withdrawals on credit cards as far as possible since the interest charged is rather stiff.

Future gets RBI nod for credit card

From The Economic Times

MUMBAI: Even as Kishore Biyani's Future Capital Holdings (FCH) awaits approval from Sebi on its proposed initial public offering, the company has got the nod from RBI for its credit card venture.

The financial services arm of the Future group has tied up with the country's largest private sector bank - ICICI Bank - to launch Future Card, a credit-cum-loyalty card which will offer customers a slew of discounts and benefits across Future Group stores.

Customers will receive four loyalty points for every Rs 100 spent at Future group's retail stores, including Pantaloons, Central, Big Bazaar and Food Bazaar and one loyalty point for every Rs 200 spent outside the group's retail stores.

Apart from credit cards, FCH plans to offer home equity loans, money transfer services and distribute mutual funds, life and general insurance products. The financial services retail offerings is housed under Future Money and the management may look at the possibility of hiving this off into a separate entity. At present, Future Money, through its 60-odd outlets, provides consumer durables, furniture and personal loans.

Interestingly, the Future Group already has a co-branded credit card with ICICI Bank, named ICICI Bank Big Bazaar card. However, unlike the benefits of Future Card, this card can only be used at Big Bazaar outlets. FCH will give the 5 lakh-plus existing holders of ICICI Bank Big Bazaar card the option to migrate to Future Card.

According to the arrangement between ICICI Bank and FCH, the bank will determine the terms and conditions of the Future Card and will be responsible for collection and recovery of all charges and fees due from card customers while FCH will be responsible for marketing and distributing the credit card and for collecting applications from customers.

FCH will receive from ICICI Bank an acquisition fee of Rs 600 for every new credit card issued, with a provision for an annual escalation, and also receive incentive commissions based on a percentage of customer spends which are 0.7% for spends within Future Group formats and 0.2% for spends in other outlets.

SBI adopts Majhdaha village

From The Business Standard

The largest public sector bank of the country, the State Bank of India, today adopted Majhdaha village in Nadia district of West Bengal under its scheme, 'SBI ka apna Gao'.

The scheme aims at raising all BPL families to the APL level by providing 100 percent financial inclusion.

“Under this scheme we would meet the credit requirements of all eligible rural household of the village, and transform it into a model by improving the quality of life of the people,” said O P Bhatt, chairman of SBI.

The scheme would also promote self help groups, “Farmers' Club”, with the assistance of NGOs and other development agencies and also form a linkage of community services with banking activities.

“The next step would be to draw out a plan for the overall development of the village with the active support from the district administration,” he added.

The chairman distributed 3,000 sanction letters to the farmers under the Kisan Credit Card to meet their financial needs for cultivation purposes.

The bank also adopted six orphan children under the “Adoption of Girl Child” scheme.

“The idea behind the scheme is to adopt a needy girl child between the age group of 8-14 years by each of our branches in the Bengal Circle, for which an annual expenses in the range of Rs 3000-5000 would be borne by each branch towards the cost of her education,” Bhatt explained.

The chairman also extended financial assistance to SHGs and visited the stall erected by them, exhibiting their products.

“SBI would extend continued support for ensuring development through the collective effort,” he added.

Yatra, Barclays to launch online travel credit card

From The Economic Times

NEW DELHI: Travel services company, Yatra Online and global financial services provider Barclays will soon launch the Yatra Barclaycard, an online-travel co-branded credit card and a multi-carrier frequent flier programme.

The card offers attractive travel benefits and rewards, and is tailor-made to keep pace with the rapidly growing demands of frequent business and leisure travellers, Yatra Online Services CEO and Co-founder Dhruv Shringi said in a statement.

The Yatra Barclaycard is designed for the fast growing group of Indian travellers offering wide global acceptability, flexibility on credit limits and billing dates, while the Yatra Miles programme offers travel-related benefits.

"The range of cards especially targeted at Indian travellers who are increasingly using online travel services without having their spend rewarded," Barclays Bank PLC Head of Cards-India Kusal Roy said.

US CREDIT-Belo Corp. debt weakness seen persisting

From REUTERS

NEW YORK, Oct 2 (Reuters) - Belo Corp.'s (BLC.N: Quote, Profile , Research) debt protection costs may rise further as the family-controlled media group spins off its newspapers into a new company.

The media firm on Monday said it will spin off The Dallas Morning News, The Providence Journal, and The Press-Enterprise in Riverside County, California, into a new company called A.H. Belo Corp early next year. Belo will keep its 20 television stations and their Web sites. For details, see [ID:nN01267319].

Stockholders cheered the news by bidding up Belo's shares on Monday, having long clamored for the split on the grounds that Belo's broadcasting business was being undervalued because of advertising declines at its newspapers and a migration of readers to the Web.

But Belo's spin-off announcement was a strong blow for the firm's debt and credit investors.

Standard & Poor's cut Belo's ratings to junk territory, citing increased risks at the company, while Moody's Investors Service warned it may do the same soon. Moody's awards Belo a "Baa3" debt rating, which is one step above junk status.

The cost to insure Belo's bonds with credit default swaps jumped 35 basis points on Monday to around 154 basis points, which means it costs $154,000 annually to protect $10 million of its debt for five years. Belo's credit protection costs were roughly unchanged from that level on Tuesday.

But they are likely to rise further, according to Hale Holden, an analyst at Barclays Capital in New York.

Holden said in a report on Monday that Belo's debt protection costs could rise another 50 basis points. "We think (Belo's credit default swaps) should trade at about 200 basis points," he said.

Jake Newman, an analyst at research service CreditSights, said in a report on Tuesday that, "Much of the damage to bond spreads has already been inflicted, but we would recommend an underweight."

For one thing, S&P and Moody's both said they were concerned about higher financial risks at Belo following the spin-off of the publishing assets.

"The plan will result in a significant increase in Belo's leverage as all of the existing debt will remain with the company to be supported by the broadcast operations," Moody's said in a statement.

"Bondholders will be hurt in the split," CreditSights' Newman said. "There will be less cash flow to service the debt."

But some analysts also believe that the spin-off is just the first step in a sale of the TV assets and recapitalization of the newspaper assets.

"Creditors will be leery of the television company," Newman said. "Creditors may also fear a leveraged buyout of the television group."

Barclays' Holden, for example, said the spin-off was a reversal from the company's previous public comments.

Belo Chief Executive Robert Decherd "has historically said that the only rationale for a separation was an eventual sale of the company," Holden said in a report.

Belo executives on Monday said that the two Belo companies have no plans to sell themselves.

But even if any such moves eventually occur, they may not happen in the near term.

CreditSights' Newman said the nature of the spin-off, which involves a tax-free distribution of A.H. Belo shares to Belo Corp. shareholders, makes that difficult.

"The provision that allows a tax-free spin-off to the current owners would not allow a tax-free spin if the subsequent sale could be construed as part of a larger plan to dispose of the assets tax-free," he said.