Amazon is actively exploring new collaborations with banks to expand its credit card offerings, as disclosed by a high-ranking company official on September 27th. As of June 2023, Amazon, the global e-commerce titan, has an existing partnership with ICICI Bank, resulting in a successful co-branded credit card initiative that has already issued over 4.2 million credit cards.
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Vikas Bansal, the whole-time director of Amazon Pay, has provided valuable insights into the company’s strategic direction. He stated, “As we contemplate the expansion of our credit services, we are actively considering the prospect of establishing partnerships with additional banks and expanding our presence across various payment networks.”
Mr. Bansal underscored Amazon Pay’s commitment to staying attuned to evolving trends and the evolving needs of its customers, with a particular emphasis on addressing the growing demand for credit card solutions among small businesses.
ICICI Bank has reported an impressive 45 percent growth in its credit card portfolio during the June quarter. This remarkable surge can be attributed to higher customer activation rates facilitated by streamlined digital onboarding procedures, which encompass the issuance of Amazon Pay credit cards.
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According to Mr. Bansal, Amazon Pay’s clientele has displayed a strong inclination towards exploring credit-based alternatives. This encompasses the co-branded credit cards established in collaboration with ICICI Bank, “pay later” options, and installment plans crafted in partnership with various lending institutions.
Mr. Bansal also highlighted the significant impact of these initiatives in the state of Maharashtra, where a notable 50 percent of sales transactions now leverage diverse credit avenues. Furthermore, the user base for “pay later” services has experienced a substantial 50 percent growth in 2023 compared to the preceding year.
However, comprehensive nationwide statistics pertaining to the utilization of credit for e-commerce transactions were not readily accessible. Additionally, Mr. Bansal refrained from offering insights into the recent decline in the national financial savings rate.
Amazon has disclosed that, in 2023, an impressive 80 percent of Amazon Pay ICICI Credit Card holders in Maharashtra have actively used their cards at least once. Furthermore, the company conducted a comprehensive survey that unveiled a positive sentiment prevailing as the festive season approaches.
The survey revealed that over 80 percent of the respondents expressed a strong intention to engage in shopping during the upcoming festive sales. Notably, more than half of these respondents indicated their plans to increase their spending this year, highlighting a favorable outlook for Amazon’s credit card offerings.