StanChart reviews offers from India's Kotak, Federal to acquire credit-card-only customers, sources say

By Gopika Gopakumar and Aditya Kalra

MUMBAI, March 18 (Reuters) - Standard Chartered STAN.L is reviewing offers from Kotak Mahindra Bank KTKM.NS and Federal Bank FED.NS to acquire the British lender's up to 600,000 customers in India who only have credit card accounts, two sources with knowledge of the matter said.

The potential divestment is part of StanChart's strategy to reduce focus on single-product clients, they said.

The London-based lender has been offloading non-core components of its portfolio in India to improve its profitability. Last year, Standard Chartered sold its India personal loan business that at the time was valued at $488 million to Kotak Mahindra Bank.

Kotak and Federal have submitted final offers for acquiring StanChart's India portfolio of credit-card-only customers, who have no other relationship with the bank and are considered non-core to its business, said the two sources, who declined to be named as the deal talks are private.

The financial details of Kotak and Federal's proposals were not immediately clear.

The Indian lenders and Standard Chartered did not respond to requests for comment.

"StanChart is currently reviewing both of these offers and it is expected to take some time," one of the sources said, adding that the potential sale does not indicate the bank is completely exiting the credit-card business.

The move is linked to the bank's strategy to get rid of "non-core accounts," the person said.

StanChart's plan to sell the portfolio of cards has been reported. But Reuters is first to report that Kotak and Federal are in the race for it.

THE BUSINESS OF CARDS

For the two Indian lenders, acquiring the portfolio could present an opportunity to scale up their credit card base and reduce customer acquisition costs in a competitive market for such products.

Kotak has 4.5 million issued credit cards in India, while Federal has 2 million. That compares with StanChart's 670,000 credit cards in the country.

After the deal, StanChart plans to retain around 70,000 Indian credit card customers, affluent clients who have other banking relationships with the lender, the second source said.

On a call last year, StanChart interim Chief Financial Officer Pete Burrill said the bank was focused on offloading portfolios tied to single products without broader client relationships or those outside the affluent category.

While it is reducing its focus on credit-card-only customers in India, StanChart in January launched an invite-only "Beyond Credit Card" for priority clients, in what it described as its "strategic pivot to the wealth and affluent segment."

StanChart is among several foreign banks that are scaling back their retail operations in India due to stiff competition from local firms.

In 2023, Citigroup C.N exited the market by divesting its India retail franchise to Axis Bank AXBK.NS, while Deutsche Bank DBKGn.DE is exploring a sale of its retail and wealth management business in the country.

StanChart's 2025 annual report said it generated operating income of $1.6 billion from India, which was 7.8% of the bank's total global income.