LIC To Enter Credit Cards With GE Money

Life Insurance Corporation of India, the largest life insurer in the country, is all set to offer credit cards. The corporation has entered into an agreement to create a credit card company with GE Money India, Corporation Bank, LIC Housing Finance Ltd and LIC Mutual Fund. LIC will hold the largest stake in the new entity at 40 per cent, followed by GE Money at 30-35 per cent. While around 10 per cent stake will be sold to financial investors, the rest will be held by Corporation Bank, LIC Housing Finance and LIC Mutual Fund.

The new entity will be set up with a capital base of Rs 150 crore, and the joint venture partners will finalise the agreement by end-October. LIC had engaged KPMG to study the prospects of entering the credit card market and identify joint venture partners. Through this joint venture, LIC aims to offer its policyholders the facility to pay their premium with LIC''s own credit card.

The new venture will use the extensive branch, ATM and sales distribution network of LIC and Corporation Bank. GE Money will provide its global and local expertise in credit cards, business management processes and technology-driven platforms GE Money, a unit of General Electric Company, operates in over 55 countries and has 10 crore cards in force. GE Money is part of a strategic joint venture in SBI Cards.