Payments service provider and credit card issuer SBI Cards and Payments Services Pvt. Ltd. is expecting to raise Rs 9,854 crore in its upcoming IPO, which opens its issue from March 2 to March 5. SBI Cards is the second largest credit card issuer in the country after HDFC Bank; as of FY19, it has 8.3 million credit cards in force, 103,835 crore in credit card spends, and 280 million transactions, according to its Red Herring Prospectus. SBI Cards has 17% market share by credit card spends, and 18% market share by number of credit cards in force. It is registered as a non-banking financial company with the RBI, and started operations in 1998. After the IPO, SBI's shareholding in SBI Cards will fall to 70% from 74%, and CA Rover Holdings' will reduce from 26% to 16%. SBI Cards' captures 72% market share by number of outstanding credit cards (as of March 2019) and 66% market share by credit card spends in FY19. The company is dependent on SBI's massive customer base, to which it issues and markets cards. Half of SBI Cards' revenue comes from interest on credit card dues, and the other half comes from non-interest income such as interchange fees, late fees, credit card membership fees, and other fees. Interest on revolving and term credit card balances made up 53.2% of the company's total operational revenue in FY18, and 56.4% in FY17. Non-interest income comprised 48.9% of total operational revenue in FY19, 46.8% in FY18 and…
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