Faced with competition from private insurance companies and in an effort to branch out to new areas to provide better services to its customers, Life Insurance Corporation of India is planning to launch credit cards that would charge extremely low interest.

"We are in talks with Master Card and Capital One to launch credit-cum-debit card and are currently negotiating processing fee and interest rates," a top LIC official said on Wednesday, adding, it could also be used as a smart card.

Refusing to give any time-frame for the launch, the official said the talks were at nascent stage and it was very difficult to comment on the details at present.

LIC, the official said, was particularly negotiating with the companies to charge a maximum 12 per cent interest from the card users as against 34 to 36 per cent charged by other companies in the business.

Asked why a company would agree to charge only 12 per cent interest against the prevailing rates of over 34 per cent, the official said any credit card company joining hands with LIC would get a huge data base from the corporation, which in itself was a big benefit.

The official said the card facility would be offered to a select group of policyholders and would make collection of premiums much easier.

"In addition, LIC card holders would be able to avail of ATM benefits of other banks without any extra cost. A person's deposit against a policy is likely to be treated as guarantee," he said.

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What do you think about the story? Read what others have to say: Number of User Comments: 26 Sub: Wait a while , we will make your wait worthwhile i knew we missed the credit cards from LIC. This is just a beginning and LIC will make our lives LIC - Life in comforts.For ... Posted by Rajesh Iyer Sub: Mizoram will celebrate This is great news, when launched Mizoram,Manipur and other Northeast states LIC policy holder, will celebrate. There are more LIC policy holder in villages. Posted by Vanlal Sub: V.GOOD STEP AGAINST THE PVT. AND ABORD ONES This is v. good step to beat the above parties and get back to a good position in market. Here I have request to the ... Posted by NK Sub: lic launching credit card It is very good thinking on the part of lic to launch credit card with policy deposits as gurantee with intrest rate of 12 percent. Posted by deepak Sub: LIC - The Strongest Insurance Co. Better late than Never.At last LIC is also entering in one of the largest sector in Financial Market.I am sure the way it has captured ... Posted by Ashwin Bhojwani