Samsung has launched two credit cards in India, entering a crowded category in which more than 50 companies are fiercely competing for consumer attention in the world’s second largest internet market.
The South Korean giant said it is teaming up with Axis Bank, the Mumbai headquarters and global payment processor Visa to launch the cards, which make it the Samsung Axis Bank credit card. Consumers who purchase Samsung’s products and services through either card will receive “10% cash back all year round,” the company’s executives said at an event in New Delhi.
(There is a monthly limit of 2,500 Indian rupees ($31) on the Signature card, while the Infinite card extends that limit four times. The cashback is capped at 10,000 Indian rupees ($123) annually on the Signature card and 20,000 Indian Rupees ($246) on Infinite card.)
Samsung, the second largest smartphone vendor in India, said it will also offer customers “exciting” financing options on its credit cards. The cards are mainly aimed at serving consumers in smaller Indian cities and towns, the executives said.
Even if the space that Samsung is entering is overcrowded, the chances are undoubtedly high. Indian banks have issued more than a billion debit cards to customers in the country, but according to industry estimates, fewer than 25 million unique individuals in the country have a credit card.
Customers earn rewards for spending through their cards and access offers from local businesses, including food delivery service Zomato, fashion e-commerce Myntra, online pharmacy Tata’s 1mg, grocer Bigbasket and Urban Company.
Monday’s announcement underscores the growing effort of smartphone manufacturers to expand their services. Chinese giant Xiaomi, which controls the smartphone market in the country, launched a UPI-powered payment service in India in 2019 and started lending to customers last year. (Samsung launched its payment service Samsung Pay, powered by UPI, in India in 2017.)
Co-branded cards are generally “a win-win for the bank, partner brand and customers” because it allows powerful brand users to reap higher benefits the more they spend on the brand.
“The brand gains more loyalty from its users, while the bank clearly benefits by accessing a different customer base, where the customer acquisition itself comes from the brand or the brand’s loyalist users,” said a Bengaluru-based fintech executive. to londonbusinessblog.com, request anonymity when commenting on other companies’ products.
The annual fee on the Signature card is $6.13 before taxes, while the Infinite card charges 10 times that. The company said it will soon be accepting customer applications for the cards.
“At Samsung, we believe in transforming the lives of our consumers through the power of innovation. The Samsung Axis Bank credit card, powered by Visa, is our next big India-specific innovation that will change the way our customers buy Samsung products and spend on services through a range of industry-leading features. We are excited to put control in the hands of our consumers,” said Ken Kang, President and CEO of Samsung Southwest Asia, in a statement.