The Impact of Citibank's Exit From India on NRI Accounts
USD INR ₹ 82.41
GBP INR ₹ 101.08
CAD INR ₹ 59.66

Citibank Exits India – What Does This Mean For Your NRI Account

Updated on June 04, 2021 12:00 am
Citibank Logo Store Front

The decision by Citibank to exit from 13 countries across Asia and Europe, including India, poses a big question about its impact on the bank's existing customers and employees in the country. The multinational bank has had a consumer business in the country since 1902, allotting a host of facilities to not only Non-Resident Indians (NRIs) but residents alike with credit cards, mortgages, and personal banking features globally. At present, Citibank is one of the largest foreign lenders in India.

Citibank India assures that this announcement will not impact its existing customers or its employees as they are exiting the country but not closing business. However, customers must be prepared for changes depending on the products and the terms and conditions of the new bank company once overtaken successfully.

Why Has Citibank Chosen To Exit India?

Citibank announced it is shutting down its retail banking business including credit cards, savings bank accounts, personal loans, etc. in 13 countries including India. Excluding Singapore, Hong Kong, UAE, and London, the 4 wealth centers - from where the bank intends to operate its consumer banking business.

 According to the reports, Citibank is facing scalability issues in these countries including India, and hence the decision to cut down the costs and strengthen their business in more developed countries was made. However, the exact reason for the exit is unknown.

Mr. Ashu Khullar, CEO of Citibank India assures that there will be no immediate changes in operations, the firm is dedicated to "serve all clients with the same care, empathy, and dedication", and he also assures that they need not be worried about their savings.

Citibank's exit from India can be seen as an opportunity for banks in India, to either acquire the existing stock of clients or gain share markets in segments like loans, credit cards, etc. One can only speculate the degree of the impact its decision will have on the existing account holders and employees.

What Is The Immediate Impact Of Citibank's Exit On The Indian Banking Scenario?

Citibank's decision to exit its retail banking business in India has drawn all potential buyers to show interest in Citibank's retail products. These include bank accounts, deposits, credit cards, and retail loans. Among all the products, credit cards have been the most high-profit business for Citibank in India with about 6% market share in spends.

Citibank India has over 2 million credit card accounts and claims to have its average credit card spend 1.4 times the industry average. However, over the years, popular competitors such as HDFC Bank, ICICI Bank, and SBI Card started chipping away from Citibank's market share.

Given Citibank's account of a great mix of premium credit cards and corporate cards, this announcement would invoke interest among both large and small players in the banking industry.

How Will Citibank's Exit Affect The Existing Account Holders?

Since Citibank India has already started looking for buyers to take over its retail business operations. The bank assures its commitment and dedication to serving its customers and employees without any change or impact of the decision until the firm has been successfully handed over.

The bank is not shutting down its business although an exit process will be initiated right after the formal approval from the Reserve Bank of India. It will be a structured process without any changes in operations until the sale takes place. The bank will continue to do business and provide services to its customers until the new buyer/s takes charge.

Should The NRI Citibank Account Holder Be Concerned About The Potential Buyers?

Citibank's exit is an opportunity for many banking companies both local and residential, large-scale issuers like SBI Card, ICICI Bank, Axis Bank who might be interested in increasing their share of premium credit cards.

Small scale banks such as RBL, IndusInd Bank, DBS Bank, IDFC First Bank, etc. may see it as an opportunity to upscale and widen their operational facilities. As times are rapidly changing, a local banking system might be more conducive for a non-residential system to transfer funds with ease to their concerned beneficiaries to remotest of areas in India.

Will Citibank's Exit Impact The Credit Card Business In India?

The bank confirms that all business including the credit card business, will function normally without making any impact on the customers. However, once the sale process is completed, it will be upon the customers to choose whether to continue with the new owner or close their account.

Since every banking firm has its separate terms and conditions, rules, and regulations. Citibank assures smooth transactions and payments through its credit card facilities to all NRE account holders worldwide.

Why Is Citibank So Popular?

Citibank under Citigroup is one of the largest banking firms providing myriads of varied financial services across 19 countries with over 200 million customer accounts globally. It offers banking facilities such as deposits and loans mainly through Citibank itself, investment banking, brokerage, wealth management, and other financial services around consumer banking.

It has been the most preferred banking company by Non-Residential Indians with access to products and services that are booked offshore with Citibank India. Transactions could be executed outside of the country without any participation from any Citigroup or Citibank subsidiary, branch, or affiliate unless applicable to local laws and regulations of the jurisdiction where they are booked and offered.

This New York-based bank today is a significant foreign investor in the Indian financial market. The NRI Savings Account is an interest-bearing checking account where the balances are held in Indian Rupees. It offers two types of NRI Savings Account: Non-Resident External and Non-Resident Ordinary.

Based on the relationship balance maintained in the accounts Citibank offers two packages - Preferred or Citigold. To learn more visit Citibank's website.

Features & Benefits Of Holding An NRI Account With Citibank?

Citibank offers multiple services to its NRI customers including savings accounts and money transfer services. Few benefits are:

  • Offers interest-bearing Savings Account
  • The convenience of new account opening application and operation of account whether living outside of India or to your beneficiary India
  • Zero charges on funds transfers and bill payment options in multiple currencies and conversion
  • Zero charges on international wire remittance facilities, if you are working abroad and sending home money to India
  • Issuing Check Books at no charge
  • 24/7 Access, Online, and Mobile Banking facility
  • Provides Debit Card with global access - withdrawing from ATMs or paying on purchases with MasterCard merchant establishments anywhere in the world

Related Article: Spotlight On Citibank's NRI services in detail here.

Rate article:
Money Transfer FAQ's
Download the CompareRemit App
Download the CompareRemit App
Personalize your CompareRemit experience with your preferred corridor and receive target exchange rate notifications, seamless transitions to partner apps, and real-time comparisons of top remittance providers at your fingertips.
Personalize your CompareRemit experience with your preferred corridor and receive target exchange rate notifications, seamless transitions to partner apps, and real-time comparisons of top remittance providers at your fingertips.

Get Listed or Advertise

Download Our Free App

Try our faster, enhanced mobile app for a better experience

CompareRemit App