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May 26, 2011

  • News:  GE Capital Looks At India 

    GE Capital, the financing unit of General Electric, is hoping their credit card business will drive growth in India. Even as others like Deutsche Bank are exiting the market, GE seeks to expand their unit. GE Capital CEO Anish Shah says their credit card business is thriving and they see a lot of potential in the next few years. Over the last decade the card business has come full circle. For a time, banks were aggressively pushing their cards into customer's hands and that led to major defaults in the last credit crisis. Banks became more sensible and the number of credit cards in India fell to 18.28 million as of the end of March 2010 from 28.3 million in April 2008.

    2011 numbers show credit card transactions have increased 26 percent, which is a good sign for a company hoping to grow their business. GE wants to capitalize on this increased growth. They currently have a fraction of this market compared to most other markets so there is a lot of room to expand in India. Shah says they are looking to offer their "card services in the most cost effective way." GE has about 12 million customers in India, which is quite small in comparison to their U.S. market in which they manage over 130 million credit cards. Experts say that India's card potential is far greater than the only 18 million cardholders would suggest. By comparison, countries like China and Brazil have around 200 million cards.

    SBI runs the credit card business with GE and their chairman, Pratip Chaudhary expressed concerns stating they had "no experience in the card business" as it was left to GE to handle operations. GE is counting on the reach of SBI to grow this business. They are looking to expand into smaller towns in spite of their lower spending capacity.

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