NBFC Credit Card Directions 2025: What Eligible NBFCs Must Follow

The Reserve Bank of India (Non-Banking Financial Companies Credit Cards: Issuance and Conduct) Directions 2025, issued on 28 November 2025, govern the issuance of credit cards by eligible NBFCs. Only specific categories of NBFCs, primarily NBFC-Deposit Taking (NBFC-D) entities and those with specific RBI approval, can issue credit cards. The Directions establish both the eligibility framework and the conduct standards for credit card operations.

NBFC credit card directions 2025 are the first standalone directions specifically governing NBFC credit card issuance, replacing the earlier consolidated circular framework. This guide covers the key provisions for NBFCs eligible to issue credit cards.

Which NBFCs Can Issue Credit Cards Under the 2025 Directions

NBFC credit card eligibility under the 2025 Directions is restricted to:

• NBFC-D (Deposit Taking): deposit-taking NBFCs with the specific approval to issue credit cards from the RBI.
• NBFCs with specific RBI credit card authorisation: non-deposit-taking NBFCs that have received explicit written authorisation from the RBI to issue credit cards. Not all NBFCs can issue credit cards; it requires specific approval beyond the standard NBFC registration.

NBFCs that issue co-branded credit cards through a bank partnership where the bank is the card issuer and the NBFC is the co-branding partner are not technically issuing credit cards under the Directions. The bank is the issuer; the NBFC is a marketing and distribution partner. The NBFC should confirm the legal structure to determine whether the credit card Directions apply to its specific arrangement.

Interest Rate and Fee Disclosure Requirements

Credit card interest rate disclosure requirements under the 2025 Directions are among the most specific in the framework:

• Annual Percentage Rate (APR) disclosure: the full APR, including interest rate, processing fees, late payment charges, and any other recurring charges, must be disclosed in the credit card agreement and on each monthly statement. The Directions specifically prohibit expressing the interest rate as a monthly rate without also expressing the annualised equivalent.
• Grace period disclosure: the exact grace period (interest-free period) must be clearly stated. The grace period is the time between the statement date and the payment due date during which no interest accrues on new purchases if the previous month’s balance was paid in full.
• Minimum due clarity: the minimum payment due must be presented with an explicit disclosure of the outstanding balance, the minimum payment amount, the interest that will accrue if only the minimum is paid, and the estimated time to repay the full balance at minimum payment only. This “minimum payment warning” is a consumer protection requirement introduced in the 2025 Directions.
• Pre-payment charges: if the NBFC charges a fee for full prepayment of credit card outstanding before the due date, this fee must be disclosed upfront in the card agreement and on the statement.

Credit Limit Management and Over-Limit Provisions

Credit limit management under the 2025 Directions:

• Consent for credit limit increases: automatic credit limit increases without explicit borrower consent for each increase are prohibited. The NBFC must obtain affirmative consent before increasing a credit card limit.
• Over-limit charges: if the NBFC permits transactions over the credit limit (with a pre-authorised over-limit facility), the over-limit fee must be disclosed in advance, and the facility must be opt-in for the cardholder. Default cardholder onboarding cannot include over-limit facilities without explicit consent.
• International transaction charges: foreign currency conversion fees and cross-border transaction markup must be disclosed as a specific percentage at the time of the international transaction, not buried in the billing statement.

Billing Cycle, Statement, and Grace Period Requirements

Credit card billing requirements under the 2025 Directions:

• The monthly billing cycle is the standard. The NBFC must maintain a consistent billing cycle date for each cardholder.
• Statement must be delivered at least 14 days before the payment due date, providing adequate time for the cardholder to review and pay.
• Digital statement delivery is permitted. The NBFC must confirm the cardholder’s preferred delivery method (email, SMS, in-app) and maintain delivery records.
• The grace period is the period between the statement date and the payment due date during which the full balance payment attracts no interest. The minimum grace period is 21 days.
• If the full outstanding balance is paid by the due date, no interest should accrue on new purchases in the following cycle until the next statement date. The direction specifically addresses the “interest on interest” problem where partial payment in one month causes interest to accrue on all new purchases in the next month, a practice that must be disclosed if applied.

Credit Card Collections: Conduct Standards

Credit card collections conducted under the 2025 Directions follow the same Fair Practices Code standards as other NBFC lending:

• No contact before 8 AM or after 7 PM for collection purposes.
• Collections agents must identify themselves and the NBFC they represent in every contact.
• Written communication must be in the language the cardholder has selected for their account.
• Threatening, harassing, or public-shaming collection tactics are prohibited and constitute a Fair Practices Code violation.

An additional credit card-specific provision: if a credit card account is disputed by the cardholder, collections activity on the disputed amount must cease until the dispute is resolved. Continuing to charge late payment fees and interest on a disputed amount while the dispute is pending is prohibited.

Key Takeaways

• NBFC Credit Card Directions 2025 are the first standalone directions governing NBFC credit card issuance, applying to deposit-taking NBFCs and those with specific RBI credit card authorisation.
• APR disclosure (full annualised rate), minimum payment warning (time to repay at minimum payment), and grace period disclosure are specific transparency requirements.
• Credit limit increases require explicit cardholder consent; automatic limit increases without consent are prohibited.
• Billing statements must be delivered at least 14 days before the payment due date; the minimum grace period is 21 days from the statement date.
• Collections on disputed amounts must cease until the dispute is resolved. Interest and late payment charges cannot continue to accrue on disputed balances during resolution.

Frequently Asked Questions

Conclusion

NBFC Credit Card Directions 2025 establish a comprehensive, borrower-protective framework for credit card operations by eligible NBFCs. The transparency requirements APR disclosure, minimum payment warning, and automatic limit increase prohibition directly address historical consumer protection gaps in the credit card market.

For eligible NBFCs operating credit card programmes, the priority compliance actions are: updating the monthly statement to include the minimum payment warning, confirming the 21-day minimum grace period is maintained, and implementing the consent-based credit limit increase process.

Looking to strengthen your NBFC’s credit card compliance? Talk to our experts to build smarter, RBI-aligned compliance frameworks.