In order to give customers the freedom to choose, the Reserve Bank of India (RBI) has asked banks and non-bank lenders to issue credit, debit and prepaid cards on multiple networks.

"On a review, it is observed that arrangements existing between card networks and card issuers (banks and non-banks) are not conducive to the availability of choice for customers," the RBI said in a draft circular.

Networks of American Express, Diners Club International, Mastercard, Visa and homegrown RuPay offer services to customers in India. But the choice of affiliated network for a card is usually predetermined by the bank.

Card issuers should issue them across more than one network, the RBI said in a circular. Financial institutions should provide an option to their eligible customers to choose from the multiple card networks in the country, the central bank added.

That option may be exercised by customers either at the time of issuing, or later, it further stated.

These changes will be effective October 1. The RBI has sought stakeholder feedback on the draft norms until 4 August.

The central bank said card issuers should not enter any arrangement or agreement with card networks that restrain them from availing the services of other card networks.