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Tuesday, 02 January, 2018, 14 : 00 PM [IST]

IRCTC to launch its co-branded debit card in association with SBI

As per The Financial Express report, to incentivise passengers to use the online ticket booking system and adopt cashless methods, Indian Railways is set to launch its own co-branded debit card and also hold monthly lottery draw to give 100% cashback to 10 lucky passengers. The debit card will be launched in association with the State Bank of India (SBI) and the transporter’s arm Indian Railway Catering and Tourism Corporation (IRCTC). “It will be a railway debit card which can be used for any transaction but on buying rail tickets, it will be free of charges. There will be loyalty plans as well,” said a Ministry of Railways official.

The move comes at a time when IRCTC is losing INR 600 crore per year as post the demonetisation of specified currencies in November 2016, the Railways waived charges for online booking of tickets. While initially the directive was to not levy the charge till June 2017, the timeline has been revised twice since and customers will not be charged the levy till March 2018. Earlier, IRCTC used to charge INR 20 on each sleeper class and INR 40 on each air-conditioned class e- tickets, a part of which went to banks as transaction charges. Now, even as IRCTC doesn’t charge anything for online booking, it is bearing the cost of banks’ service charges. Earnings from ticket booking is the mainstay for IRCTC and as per its annual report of 2015-16, 43% of its total income came from this segment followed by 26% from tourism and 23% from catering. While Piyush Goyal, Minister of Railways, Government of India has instructed officials to find ways to reduce the burden on IRCTC due to bank charges, the official quoted above said negotiations are on and a “significant announcement will be made soon”.

The Ministry of Finance has agreed to pay INR 80 crore to IRCTC as a “one-time” compensation for the losses on online ticketing operations. The railways will also be conducting monthly lottery draw starting January wherein lucky passengers will get the entire money back spent on tickets booked online. “We will be awarding people for buying tickets online and the first draw will be on January 3. Ten passengers who have bought e-tickets providing their Aadhaar number and have travelled themselves during December will be selected through a lottery and will get the money they have spent on tickets. The draw will be done every month,” said the official. The draw will be held every month and 10 passengers from the preceding month will be selected through a draw.

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