Banks urge CCI review as chip shortage slows card issuance: Report

Facing a shortage of semiconductor chips, several banks have sought intervention by the government to address the issue which has affected the issuance of cards. in turn, affecting beneficiaries of the Pradhan Mantri Jan Dhan Yojana (PMJDY).

According to a report in The Economic Times, banks also suggested an investigation by the Competition Commission of India (CCI) to look into the business practices of chip suppliers.

Repeated Covid-19 shutdowns in China have hit supplies of chips, slowing issues of new cards. Banks are reportedly finding it difficult to provide cards to the new Pradhan Mantri Jan Dhan Yojana account holders.

The card shortage is expected to remain for some time, officials told the publication.

"We are aware of the challenges being faced by the industry and some long-term solutions, including promoting local manufacturing, will be looked at," he told ET.

"Local vendors are pushing to increase the prices despite existing supply contracts," the official said.

The Pradhan Mantri Jan Dhan Yojana was launched by the Centre in 2014 as part of a national mission for financial inclusion. PMJDY encompasses an integrated approach to bring about comprehensive financial inclusion for all households in the country. The scheme envisages universal access to banking facilities with at least one basic banking account for every household, financial literacy, and access to credit, insurance and pension facility.