Page 37 - Banking Finance February 2026

ARTICLE

cent news that NPCI is developing UPI 3.0 which will be Western Union's metal plates in 1914 to today's AI-powered
an IoT-enabled upgraded and it will allow automated digital cards, every step-cardboard slips, magnetic stripes,
payments through smart devices. EMV chips, contactless taps, and wallets on our phones-has
solved yesterday's problems while shaping tomorrow's pay-
9. The Road Ahead: Future of Credit Cards ments.
Looking forward, the credit card will likely evolve into a fully
digital identity-based payment instrument. Key trends in- Today, AI-driven fraud detection, tokenization, and digital
clude: wallets keep transactions faster and safer than ever. In In-
Y Integration with CBDCs (Central Bank Digital Currencies) dia, while UPI dominates the headlines, credit cards con-
for hybrid credit and tinue to evolve with co-branded rewards, greater security,
digital currency and seamless digital integration.
models.
What began as a physical token has become a digital one.
Y Hyper-personalized
Yet the core idea-delayed payment, empowered spending,
credit using AI-
trusted transactions-remains unchanged. The future prom-
driven risk assess- ises even more: biometrics for identity, blockchain for secu-
ment and real-time rity, and personalized, sustainable credit solutions.
lending.

Y Voice-command payments using natural language au- From a swipe of metal to a tap on glass, the credit card has
thentication. never stood still. And as finance moves deeper into the digi-
Y Green credit cards, tracking carbon footprints of pur- tal era, it is set to remain not just a way to pay-but a digital
chases and rewarding sustainable behaviour. passport to modern financial life.

Rather than disappearing, credit cards are expected to References:
transform and adapt, coexisting with real-time payment
Y RBI's Payment Systems Report December 2024
systems like UPI.
Y The Times of India
Conclusion Y The inshorts
The journey of the credit card is a story of reinvention. From Y The Wikipedia

New labour codes push up operating expenses for private banks

and insurers
The implementation of new labour codes, notified by the central government in November 2025, has led to a no-
ticeable rise in employee costs for private-sector banks and insurance companies, with higher operating expenses
reported in the October-December quarter (Q3FY26). Several large lenders and insurers have disclosed one-time
and recurring cost impacts arising from changes in wage and benefit structures.
HDFC Bank reported operating expenses of Rs. 18,770 crore in Q3FY26, up from Rs. 17,110 crore in the previous
quarter, after recognising an estimated incremental employee cost impact of around Rs. 800 crore. ICICI Bank also
disclosed an additional expense impact of about Rs. 145 crore, while Yes Bank, Federal Bank and RBL Bank reported
incremental provisions of Rs. 155 crore, Rs. 20.8 crore and Rs. 32 crore, respectively.
Private-sector insurers faced similar pressures. HDFC Life Insurance estimated an incremental employee benefit cost
of Rs. 106.02 crore, while ICICI Prudential Life Insurance and ICICI Lombard General Insurance reported impacts of
Rs. 11.04 crore and Rs. 53.06 crore, respectively.
Analysts noted that the new labour codes require a higher proportion of basic pay and allowances, increasing em-
ployer contributions towards gratuity and pension funds. In contrast, public sector banks were largely insulated, as
their existing salary structures were already aligned with the new framework.

32 | 2026 | FEBRUARY | BANKING FINANCE