How regulated is Indian Credit Card Market?

After a constant tug- off-war between Banks and Reserve Bank of India (RBI) on the interest rates ceiling on credit cards, now RBI is nudging banks over the numerous complaints from credit card holders. Despite RBI’s operational guidelines on credit cards, several complaints were received subject to excessive charges, issuance of unsolicited credit cards, unsolicited add-on insurance policies and recovery of premium charges, charging of annual fee in spite of the customer being told that the card is free, billing, offensive calls and poor response from call centers, among others. The regulator in view of protecting the cardholders has warned banks saying a penal action including a monetary penalty will be levied on banks who fail to follow the operational guidelines on credit cards. Banks that had put a hold on issuing credit cards as result of crisis have again started issuing credit cards at a snail's pace. Credit cards issuances, which fell for 18 consecutive months till March, saw a rise in April 2010 when a million cards were added making a total of 19.29 million credit cards in circulation. In the last financial year, 6.4 million cards were culled. The country’s credit card number fell to 18.28 million as on March 31, from a peak of 28.3 million in April 2008. Now the most likely trend as the market recovers will be, banks going aggressively on credit card business to catch up on the lost ground. The process will again result in unsolicited credit cards, unsolicited add on insurance policies, undue promises from issuing banks etc. In this entire process, the central bank has a greater role to play in bringing about a well controlled and regulated environment.