[IMGCAP(1)]

The National Consumer Disputes Redressal Commission, a quasi-judicial agency in India, reportedly has ruled that credit card issuers can charge annual interest rates no higher than 30%. Commission officials offered no immediate comment. A report in India's The Economic Times newspaper says the country's issuers routinely impose interest rates that range between 36% and 49%, especially for customers who miss payments. "It is true that Indian credit cardholders are charged very high interest rates as compared to other similar economies or developed countries," Prathima Rajan, an India-based analyst for United States-based research firm Celent, tells CardLine Global. Rajan says issuers charge the relatively high rates to deal with credit card default rates that range from 7% to 9%. India has at least 27.5 million credit cards in circulation, she says. But, Rajan says, issuers should do a better job of recovering credit card loans rather than charge "exuberant rates of interest." Issuers also could do a better job of reviewing cardholder applications, which would "help in reducing default rates," she says.

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