Axis Bank and Citibank announced that their respective boards of directors have authorized Axis Bank's takeover of Citibank's retail businesses in India. What does this mean for Citi credit and debit card customers?

Citigroup Inc. said that it would sell its Indian consumer businesses to the private lender for USD 1.6 billion in cash (about Rs. 12,100 crore). Customers may expect the same level of service and features from Axis Bank.

Here are a few key points about this deal that you should know of – 

To begin with, here is the announcement that Citi customers are welcomed to, when they open the Citibank’s official website: 

Important announcement on Citi’s consumer banking businesses in India

Citi has reached an agreement with Axis Bank for the sale of Citi’s consumer businesses in India.
The transaction includes the sale of the consumer banking businesses of Citibank India, which includes credit cards, retail banking, wealth management, and consumer loans, as well as the consumer business of Citi’s non-banking financial company, Citicorp Finance (India) Limited. It excludes Citi’s institutional client businesses in India. Citi remains committed and focused on serving institutional clients in India and globally.
There will be no immediate change to any product you hold with us, be it credit cards, loans, deposits, investments, or any others. All our consumer banking operations including our call centres, ATMs, relationship teams, branches, Citibank online portal and the Citi mobile application, shall continue to operate as they do today.
The transaction is expected to close in the first half of calendar year 2023 subject to requisite regulatory approvals. This announcement is only the start of a process, and while there will be a transition, we shall ensure that it is done in as seamless a manner as possible, with due notice.

This is one of the greatest acquisitions in the Indian financial services sector, and it will assist Axis Bank in closing the gap with its rivals such as ICICI Bank and HDFC Bank.

The two lenders announced a definitive deal for the sale, which would see the third largest private lender acquire Citi's affluent-focused credit cards, personal loans, and wealth management operations.

Regulatory clearances are expected in nine months, following which the payment will be made and an extensive integration process will begin.

Citibank customers will continue to get all of the awards, perks, and offers to which they were previously entitled, according to Axis Bank MD Amitabh Chaudhry on Wednesday.

“Axis Bank has grown organically all these years and has scaled well. But our aspirations are bigger. This deal gives us that strategic thrust to close the gap between us and some of our peers," its chief executive and managing director Amitabh Chaudhry told reporters.

What Does It Spell Out For Citi Employees?

Axis Bank will gain 28.5 million Savings Accounts, 2.3 lakh Burgundy clients, and 10.6 million cards following the merger.

In addition, roughly 3,600 Citi personnel who support the consumer operations in India will be transferred to Axis upon execution of the proposed merger. Citibank's loans, credit cards, wealth management, and retail banking businesses will be taken over by Axis Bank.

If the clients agree to have Axis manage their business, their accounts, credit cards, and other accounts will be transferred; otherwise, the relationship will end and they will be able to withdraw their deposits.

After the transaction is approved by regulators, all Citibank customers will need to consent to becoming Axis Bank customers. It is predicted that the transaction will take 9-12 months to complete.

Customers of Citibank will also benefit from Axis Bank's expanded scale, geographic reach, and breadth of goods and offerings.

Axis Bank intends to leverage CitiPhone Banking expertise to assure the continuity of service excellence for Citibank clients while also improving services for Axis Bank customers.

The bank will have access to 7 offices, 21 branches, and 499 ATMs in 18 cities. Customers will benefit from having rapid access to monitor and transact across product categories such as deposits, investments, payments, and protection solutions through digital banking and the highly rated Axis Mobile app, which offers 250 services.

Citibank – Axis Bank Retail Business Take Over – FAQs: 

1:When will the acquisition or takeover be completed? 

The takeover is expected to be completed in the first half of calendar year 2023 subject to requisite regulatory approvals.

2:What all Citi businesses is Axis Bank taking over? 

Axis Bank shall take over the consumer banking businesses of Citibank India, which includes credit cards, retail banking, wealth management, and consumer loans, as well as the consumer business of Citi’s non-banking financial company, Citicorp Finance (India) Limited. It excludes Citi’s institutional client businesses in India.

3:Will my Citi credit card automatically get transferred to Axis Bank? 

The Citi accounts shall be transferred to Axis Bank only if the clients agree to have Axis manage their business, their accounts, credit cards, and other accounts will be transferred; otherwise, the relationship will end and they will be able to withdraw their deposits.

4:Will I lose my rewards points and other benefits saved on my Citi Credit Card? 

Citibank customers will continue to get all of the awards, perks, and offers, on their new Axis Bank card, to which they were previously entitled. 

5:Will my Citibank credit card be upgraded to an Axis Bank credit card? 

The ‘what and how’ of the card transitions is yet to be announced by Axis Bank. But the bank has assured that Citi customers will not be deprived of any of the benefits they have been receiving so far. The final rules and regulations is a ‘wait and watch’ scenario as of now.