Ladies and gentlemen, good day and welcome to RBL Bank Limited Conference Call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star, then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. R Subramaniakumar, Managing Director and CEO of RBL Bank. Thank you, and over to you, Mr. Subramaniakumar. Thank you, ma'am. Good afternoon, ladies and gentlemen. I'm kindly put up with this short thought of mine. Sorry for that. And thank you for joining us at short notice for the discussion and announcement made by us yesterday evening. I hope you have seen the exchange release we made following the meeting of our Board of Directors yesterday. I am joined today by Mr. Jaideep Iyer and Mr. Bikram Yadav, who will address any questions you may have. So before we get into the Q&A session, I wanted to take a few minutes to set the context, and I will talk about two aspects. One, about the discontinuation of the fresh sourcing under co-brand partnership with BFL, and second, on the card's business and collection. Now, on discontinuation of the fresh sourcing, as you all know, RBL Bank and Bajaj Finance embarked on this co-brand credit card journey in late 2016. And today, we have built a co-brand relationship of approximately 3.4 million cards. It has been one of the largest and the most rewarding co-brand partnerships we have seen in the country. The success of this partnership has been based on the dedication and the hard work from both the teams, and we acknowledge BFL for being our partner. We are today the fifth largest card player in the country, and this partnership has been critical for us to get to this position. Over the past month, we have been discussing the future of this co-brand partnership, and it was felt that the synergies too have undergone a significant change over time. Now, what does this mean for the portfolio of the cards which have been sourced through the partnership? I want to use this opportunity to reiterate that there is no change whatsoever for the customer who holds the RBL Bank BFL co-brand credit card. Our bank will continue to service the full portfolio of approximately 3.4 million co-brand credit cards issued under this partnership and will ensure seamless support and customer satisfaction through our various service channels. All the customers will continue to enjoy the same benefits, rewards, and offers associated with their existing cards. At the time of renewal of the card, these cards will be reissued by RBL Bank branded credit cards in normal course. So effectively, in terms of all the aspects of the card business, be it customer service, collection, portfolio management, it will continue to be managed by us as it were before, and there is no impact on customer whatsoever. In short, the entire credit card business with underlying customer franchise remains and continues with the bank, and the customer will continue to be RBL customers as they were earlier. Touching upon what this means for the bank's credit card sourcing plan, on the aspect of new card sourcing, we have spoken on this in the past, and what we have done in this regard is as follows. First, we have invested significantly in strengthening our direct sales infrastructure and deepening credit card distribution through our branch network. Currently, direct sourcing contributes 35% of the new credit card issuances. We have planned to scale this to 50% over the next few quarters. Secondly, our bank has established a new co-brand partnership with institutions, including NBFCs like Mahindra & Mahindra Finance Limited, TVS Credit Services Limited, and consumer brands like Indian Oil Corporation Limited and IRCTC, apart from other existing co-brand partnerships. These partnerships, combined with our self-sourcing capabilities, will mean we will maintain and grow business volumes while adhering to the more prudent risk-reward framework. Credit card as a business will continue to be our largest customer acquisition engine, and our sharpened focus to acquire customers in the mass affluent and affluent segments will help us to grow the customer relationship beyond only a credit card offering. Lastly, addressing the question of any financial impact on our bank due to this decision, on the financial side, we do not expect any significant impact on profitability in any manner from this decision. The co-brand portfolio had been near-term asset quality challenges during the transition of collection in Q2 of FY25, but it remains profitable and is trending to return to normal profitability levels by Q1 of FY26. The bank has observed improving asset quality trends across buckets and anticipates normalization within the coming quarters, so the profit pool as such remains intact, and this discontinuation of the fresh sourcing under this co-brand does not alter our plans for this business. With that, I will now stop and open the floor for questions. Thank you very much, sir. We will now begin with the question and answer session. Anyone who wishes to ask questions may press star and one on the touchscreen phone. If you wish to withdraw yourself from the question queue, you may press star and two. Participants are requested to use only handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Raghav from Ambit Capital. Please go ahead. Sir, thanks for the opportunity. My first question is, what is the total number of credit cards that were sourced for you by Bajaj Finance during the first half? We were averaging around ₹35-40 thousand per month, so somewhere in the ₹2.5-3 lakh range. Is that correct, Bikram? Roughly? Yeah. That's the brain bone, correct. Yeah. Sir, what I understand is after March 2024, when RBI put out some directives with respect to co-branding of cards, I guess the fees that Bajaj Finance would have earned were only restricted to sourcing and distribution. Is that correct? Because earlier, I think they were also getting incentivized for collections or in some way being compensated for collections. But in 1HFY25, whatever they would have earned was only sourcing and distribution. Is that understanding correct? No, sir. Raghav, we had a partnership which was built on a situation where we could mine their customers, and the way it was built was that the upfront payment on sourcing was relatively lower, and there were payouts across interchange income, annual fee sharing, etc. On the specific collections front, it was a pass-through cost for us when they were collecting on the customer base. When that moved to agencies directly handled by us, that cost effectively comes to us, so I don't think from a commercial standpoint, there has been an impact on this from an income sharing standpoint as such because of the RBI guidelines. Understood. Just to understand, what is the typical sourcing or distribution fee that you guys would pay to an external partner? Is it somewhere around INR 3,500? So say, for example, if Bajaj Finance were to source a card for you, then they would be earning. Yeah. So without getting into specifics, Raghav, the upfront payment to Bajaj would be between a third and half as compared to normal sourcing. And therefore, the arrangement was on a payment across other earnings from the customer. Understood. Understood. Thanks, and that's all from my side. Thanks. Thanks, Raghav. Thank you. Thank you. The next question is from the line of Rikin Shah from IIFL Securities. Please go ahead. Hi, good morning. I had two questions. First one, I just wanted to understand the real reason behind the end of this partnership. While the press release does mention that the synergies have changed significantly, but it was still a good sourcing mechanism while we have been diversifying. Is a regulatory nudge one of the reasons or change in the collection mechanisms? What is really driving this end of the partnership? That's the first question. And the second one, while in the opening remarks, if I understand correctly, you mentioned that while the credit cost is currently elevated, we were expecting that it would kind of normalize lower over the subsequent quarters. Now, the benefit that we would have otherwise accrued now gets nullified because of the end of this partnership. So it's still a financial impact, right? I think we would all appreciate if you could give us a bit more color on what the exact financials were, what kind of fee income you were making, not only fee income, the overall interest income fee income, and how does that change with the end of this partnership? Sir, I think let me take the second part. I think as Mr. Subramaniakumar elaborated in the opening remarks, the customer base, the book, the current advances associated with that book, all of that remains with the bank, was with the bank, and will continue. There cannot be any change because ultimately the card issuing bank is RBL Bank, and we will continue to service the customers and, if required, even cross-sell other products, at least savings accounts, so there is no change, and therefore, income from this pool will continue as and when collection outcomes improve, that benefit will come. Right now, as you rightly said, the credit costs are elevated, so there is really no change to the existing book at all for the bank. We have to focus on the incremental thing, right? So for instance, while the existing book will still be there. I'm coming to incremental, so as I said in the answer to the earlier question, the current run rate of acquisition from BFL has been in that 30 to 40 thousand cards per month range. And overall, our own gross additions of cards have come down from about 2.25 lakhs to about a lakh or so. And I think we will go back to this one lakh number in the next, let's say, three to four months because we have naturally signed up, as mentioned before as well, with new card partners, and we are continuously improving the productivity as well as including the numbers on the direct sales force and launches. So therefore, if you want to quantify the impact that for the next three months or four months, we will acquire 35,000 or 30,000 into 420,000 cards less on a 5.5 million base, if you think that is financial impact, I don't think materially that really makes a difference. That's the point we are trying to make. Fair enough. But how about when you try to replace this origination fee that you earlier paid to BFL? And if I heard clearly, we were paying much lower fees in terms of origination to BFL versus if we were to incur that CAC ourselves. So if you could quantify that impact as well, please. Yeah, so I think, as I said, the overall acquisition gross acquisition number for us is itself now in the, it's going to be in that one lakh range plus minus, and therefore, again, if you look at the numbers, that is also less material. Plus, when we acquire customers directly through our channels, there is no payout that is required to be done to any partner, etc., etc. at all, right? Because that has been sourced by us, so that continuing stream of sharing will come down, and therefore, effectively, the outcome is very similar. And so while there is no direct cost, but there is still a customer acquisition cost, right? There is only so much you could cross-sell to your existing customer. So what is the typical CAC for a direct origination? And if you could quantify that versus what was the fees that we were paying for each card originated via BFL, that's point number one. And point number two, while I know things will be fluid in the next few months, at least if you could provide some guidance in terms of how the credit card portfolio could be growing. So the overall credit card receivables were growing at around 17% in Q2. How do you see that playing out in the next few quarters and over the medium term as well? Because we can take the acquisition cost one, yeah. Okay, so acquisition payout when we do through our own channels on a blended basis, if it's X, what we were probably paying to BFL was 0.75X, but there was a trail payout in case of a BFL, which is not there when we acquire through our own channels. Sorry, what's the second part of the statement, please? So if I acquire directly through my own sales efforts from an open market channel, I incur an expense of X. When it was coming through BFL, it was 0.75X. Yes, and I think you made additional comment that there is one more expense. But there was, in case of a co-brand partner, you have to give a trail payout, which you don't have to give when you source it through your own channels. Fair enough. Got it. And on the credit card receivable growth guidance? In credit card now, we have seen, we already have reached a size where economies of scale and all other advantages are already digested. From here onwards, we'll range-bound grow between 10% to 15%. Got it. And to Subramaniakumar sir, please, if you could really allude to what is driving this termination of this partnership. I mean, when you say the synergies have changed, if you could elaborate on that, was there any regulatory nudge angle involved here? Because what we understand is that the co-brand partnership was supposed to be allowed until at least December 24. The RBI had allowed that. So what really is driving the termination of this partnership, please? See, first thing is, this is a mutually agreed, mutually accepted way of parting it. For the first simple reason is that our change to dynamics was not pushing for us to have a card in the range of two lakhs plus per month, which we have gained, and then we wanted to bring it down to one lakh. Under those circumstances, the existing partners and these partners, the number naturally to be sources coming down. So we mutually thought that we're making 30,000 or less than 30,000. It doesn't make the they may not be in a position to continue the same efforts while they were doing it for 1.2 lakh cards. So naturally, it felt that when the flow, the funnel which is flowing into it is just shrinking, that is, it is going to make them deliver on this. So they have just gone ahead. Second important thing is, BFL has decided to exit this line of business itself. It is not only with us. It is with them. That is exactly that is one of the major reasons for them to look at alternative business lines. They must be having other business lines. They are moving out of this particular business line. So it is a mutually agreed one. Yeah. Got it, sir. Thank you very much for answering all the questions. Thank you. We'll take the next question from the line of Jai Mundra from ICICI Securities. Please go ahead. Yeah. Good morning, sir, and thanks for this call. Sir, just to previous question, you mentioned that Bajaj, they have decided to close this business line. Sorry, if you can elaborate this. I mean, does this mean their other partnership would also end, or how does this work? We understand that they have not exited because in our discussion between Bajaj and us is that he's exiting the sourcing business from us. So we understand that they must be exiting from others also. Understood. Yeah. They have only one other co-brand partner. So. The intimation during discussion was that they are exiting this line of business in totality. The inference that Mr. Subramaniakumar has just said that we understand that they are exiting this category altogether is true. Right. Understood. Understood. And sir, I mean, just to get this clear, a few months back, we thought that maybe there is an issue in the collection mechanism which could have some regulatory concerns. So we changed that, right, in the last two quarters only. We also increased headcount. We also saw some delinquency. But now there is a rethink that this will not continue at all, right? I mean. No, no, no. There are two different questions here. The first one is the collection. See, as per the revised Master Direction, the co-brand partner is expected to do only two things. That is marketing and sourcing and nothing beyond. The first point of contact for the customer for grievance. So naturally, outcome of that particular guideline is that the collection should be with us, although it was being done by one of their other firm within the group. But we thought, letter and spirit, we had to take over, which we have taken over. So it is nothing beyond. And when the collection has been taken over and everything has been taken over, the complete control of the cards and other things are with us, right? The Master Direction compliance is one of the directions for taking over the collection with us. That is a major thing. With regard to this particular discontinuation, they are two independent activities. I don't think that we have to link it together. Not to have this business ahead is their business decision. Not to increase the card beyond 30,000 is our business decision. So both synergized to make it to failure, it is better to have it as a not to continue with this sourcing model. Right. Understood. And sir, just lastly, is there any sort of a no-poaching agreement that the customers which are there, right, the outstanding customer base of a few millions? I mean, these customers as of now, of course, once they renew the card, they would be RBL Bank customer. But in the meanwhile, I mean, fair to assume that these are I mean, there's no poaching agreement as such, right? Mundra, one point you have to understand. The moment the card is issued, it is an RBL card. Co-branded with them, they're sourcing it. Customer is RBL customer, and then also he was an RBL customer. Now also he's an RBL customer. Future also he'll be an RBL customer. When they are not in the business of card and NBFCs are not permitted to issue a card. So that the point of poaching these customers does not arise. Because they source the card, hand it over, they become customer. We do the underwriting. We do the servicing. We do the management. We do the collection. Everything is with us only. So I mean, I don't think there is an element of poaching comes into the picture here. Right. So sir, in the similar thing, I mean, there were a few businesses or a few products which we have restricted ourselves, and we had sort of offered that Bajaj only will be offering those products, right? So that now you can provide those products to these customers also. Is that a fair understanding? No. So the arrangement on this will be that as and when they become our savings account customers, we will be able to cross-sell other products. I don't think either of the parties will want to continue to respect that. Okay. Sure. Understood and all the very best, sir. Thank you. Thank you. We'll take the next question from the line of Abhijit Tibrewal from Motilal Oswal. Please go ahead. Yeah. Thank you. Good morning, everyone. So just one question. If I heard you correctly, while stopping this partnership was mutually agreed upon, if I understand correctly, this termination was at least initiated or intimated from BFL. Is that understanding correct? Yeah, that is correct. That is correct. Got it. And just one more thing, if you can kind of help us understand. While you've spoken about the fact that there were asset quality issues and maybe later when guidelines came out, you also started taking the collection responsibility yourself. Can you throw some color on that co-branded customer portfolio? So on the first one, just to clarify, while they initiated, it was obviously something that they discussed with us. And I think we were quite comfortable with that decision given the kind of volumes that was coming through the partnership. On the second one, Bikram, some color on. Business. So what color do you want on the portfolio? If you'll just say a little more on that, I'll be able to give you the picture. Sure. So I mean, while we did acknowledge that there were asset quality stress, sir, in his opening remarks also said that we expect normalization by one Q. So I mean, just some color on, I would say, what is the NPA numbers, what is the credit cost that you are seeing in that portfolio, and how is that portfolio behaving now, maybe in the last three to six months? So I think basically this our guidance or the way we were looking at it at the end of Q2 results really doesn't change. We had quite clearly indicated that the leading indicators on the BFL portfolio was improving, and that should result in lower slippages in Q3 and further lower slippages in Q4. I think that continues. We are roughly on the same trajectory that we saw when we announced results of Q2 in October. So that's one. And therefore, we are saying that we expect normalization by Q1. This, of course, will be subject to the external environment that we are in, which is not the best for unsecured. But currently, we are seeing the portfolio improving every month, month on month, week on week, quarter on quarter across all buckets. And that trend continues. Got it. Got it. This is useful. Thank you so much, Andrew. Thank you. Thank you. We'll take the next question from the line of Kunal Shah from Citigroup. Please go ahead. Yeah. Thanks for the call. So firstly, when we look at it, say, overall in terms of the retention of the customers, so was there anything which was driven by Bajaj Finance? Maybe could it actually impact the retention of the customers which are there on the existing book or maybe in terms of their spending pattern? Would any which ways it get impacted? And on the outstanding credit book in terms of the receivables, what is the proportion which is coming in from Bajaj Finance? So Bikram, the outstanding receivable is around between 50%-55% from Bajaj Finance. And the question is on that. So the Bajaj portfolio is typically mass affluent customer, and the spends coming from these customers are range bound in line with what the industry spends are. So Bikram, the question was. Retention. The impact on spends because of this transaction. Yeah. Maybe impact on spends as well as maybe retention of the customers. Maybe earlier, if there was a partnership, they were with us. But is there a way maybe you could see a slightly higher attrition or lower spends, and it could impact overall Bajaj receivables? We have seen similar exit of co-brand partnerships earlier also. We typically see that customer, once he has been acquired, has association with the bank and all the value proposition, service, and everything else around it is being given by the bank. There should not be any material change in overall spends or attrition numbers, basis our historical experience, because all these customers have been communicated and have been engaged with the bank after issuance. Earlier also, whenever we have migrated from co-brand to core, we have seen no material transition, and most engaged active customers continue to hold the card. Kunal, in addition to that, once the customer is sourced by them, only the bank is servicing them throughout the lifetime. The question of somebody else is going out of it because there's an alternative option available. Here it is with the RBL Bank only, then also, now also. So I don't think that the retention of the customer will be a challenge, excepting for the natural attrition, which happens with the one card to another card. Okay. Okay. Got it. And secondly, in terms of the profitability to last time, in fact, you highlighted in terms of how are the credit costs in the BFL-sourced credit card. And we have invested a lot in terms of the collection. So obviously, the ROA on the credit card business would have been much lower. But would it be possible to quantify maybe that because of much higher spends, collection, transitioning, and higher credit costs to BFL, in fact, the normalized ROA could have been a particular percentage, and now over the last one or two quarters, it has come down to a particular extent or even a loss, then that could help in terms of just helping us to know in terms of what could be the profitability impact and how it would maybe shape up over the next two quarters once the credit cost also normalizes. Yeah. So Kunal, nothing to do with the current sourcing arrangement having stopped. But in terms of PBT ROAs, yeah, PBT ROAs, we expect the second half and Q2 I mean, sorry, not second half, but Q2 was roughly a little bit less than half of less than half of the normalized profitability, maybe about maybe somewhere around a third. And we expect this to inch up in Q3 and then further inch up in Q4. And assuming the macroeconomic environment remains stable, we should go back to where we were as normalized profitability somewhere in the Q1 time frame. So currently, we are at about a third. And normalized profitability would maybe X of this arrangement when we are doing it in terms of our own sourcing and all because there was a sharing which was happening with Bajaj. They were also gaining out of it, and finally, they decided to exit because of the lower sharing now that they could get. So is it fair to assume that expecting that a stable credit cost trajectory, normalized profitability for RBL in particular could be higher now or no? Or maybe in terms of the co-branded card, it was like maybe assuming everything credit cost and all, it was better? No, Kunal, I think the way I would answer it is that as and when the bank sourcing becomes a large part of the book, which will take some time because right now we are focused on origination being at about 50%. I would say it is fair to assume that we should look at similar levels of profitability rather than saying that it should be materially higher or lower. Okay. Got it. With regard to your question on expenditure, Kunal, see, the expenses remain the same in the arrangement, excepting for the transition period where there will be a little overlap of the collection on both ends. Otherwise, previously, they were spending it as a portfolio. We were reimbursing them. Now we are going to spend the same amount. It is not going to alter the bottom line. Yeah. Got it. Okay. Perfect. Yeah. That helps. Thank you. Thank you. We'll take the next question from the line of Dhaval from DSP. Please go ahead. Yeah. Thanks for the call. Just extension of Kunal's question, Jaideep. So as I understood from your response was basically even after the payout, etc., the back portfolio actually better ROA than the rest of the portfolio. And that's because of the scale. And as you scale up the other channels, the ROA will go. Is that understanding correct? Or is the other way that back portfolio is actually ROA relative to the rest of the credit card portfolio? No. So let me divide this into two parts. If we look at pre-operating profits for the back book, that obviously has not changed and will not change materially going forward as well. The costs in the provisioning line is currently running elevated. And as I said very clearly, this will start moderating effective Q3. We'll continue to moderate in Q4. And we expect normalization in Q1. Obviously, that is subject to the macroeconomic environment that we are currently slightly weaker. So that's how I would put it. And I think from a two to three-year perspective, I think we should be barring a credit cycle, we should be in the normalized profitability zone which we have been in the past. I think the fact that there will be more and more sourcing from the bank's direct channels for that to make a material difference to improving profitability is more a 18 to 24-month journey, not a three to six-month journey. This was more in context of Bajaj Finance portfolio is what my question was. That holds true for that as well. Absolutely. Yes. Yes. Yes. It does. Got it. Got it. Thanks. Thank you. The next question is from the line of Nitesh from Investec. Please go ahead. Thanks for the question. The first question is on existing cards from Bajaj Finance. So does the sharing of fees will continue on that portfolio or that will also stop? So the origination costs that we were paying to BFL will obviously stop because there is no sourcing that will happen. Income to be shared on other means, some of that will continue for some time. Okay. And secondly, the arrangement with other companies like Mahindra & Mahindra Finance, etc., is completely on origination basis, right? No. Bikram, sorry, you may want to answer that. Arrangements with the recent co-brands in terms of upfront versus some fee sharing. So the recent co-brand arrangements are similar but not exactly the same. But now, since we have a lot of diversification, so they are on better terms. But the arrangement always is that there is an upfront payout linked to origination and small trail payout, which is on a continuous basis. Okay. And from a, let's say, economics perspective, do you think the economics of the new co-branded initiative is better than the BFL? As I've said, that when you have a diversified set of partners, you negotiate on better terms. So they are on significantly better terms than what we have signed up earlier. Okay. Thank you. That's it from my side. Thank you. We'll take the next question from the line of Manish Shukla from Axis Capital. Please go ahead. Yeah. Good morning and thank you for the opportunity. Of the 3.4 million cards, co-branded cards outstanding, how many have a SA relationship with you? Manish, right now, that is quite a small number, not material. So other than that, have you cross-sold any other fee or asset product to any of these card customers so far? No, not yet. I think that is so we have excepting HTBL. We have co-brand PL loans to them, but other than that, other things are less. Yeah. Yeah. We sold personal loans on that. Okay, so if I understand it correctly, the first objective of yours would be to convert more of these customers to SAR and then potentially cross-sell some more other asset or fee products? Yes. We can safely assume our going forward strategy. Yeah. And just to go back to that payout of the trail, as long as the RBL BFL co-branded card exists, will the trail continue to be payout or there is a sunset, let's say, three months, six months out, after which that will stop completely? As in the co-branded card might exist, but the payouts will stop? No. No, Manish. I think it is fair to assume that it is not a three-month, six-month sunset. Okay. Understood. Lastly, I mean, for the last couple of months, September, October, what would have been the total cards sourced by you, monthly run rate? Again, range of about 125,000. We expect it to remain at these levels itself, right? We don't expect this to bump up. I've got confusion. No. I mean, just because we have now suspended to about 30,000 cards which were coming from BFL have to be covered up. So about 50% of it will cover up in December itself, and rest of it, I think by January quarter, we will be back on track. Understood. That's very clear. Thank you. Those are my questions. Thank you. We'll take the next one from the line of Nitin Aggarwal from Motilal Oswal. Please go ahead. Yeah. Hi. Good morning, Mr. Kumar and Jaideep. Am I audible? It's a little bit low. I would request you to increase your volume a little bit. Yeah. Is it better now? Yes. Thanks for doing the call. I have three questions. Firstly, if I look at last three months, we have been having a decline in the net card base. And even though we are still adding more than a lakh card a month, as you mentioned. How should we look at the outstanding card market share now with this development and the credit card loan mix over the medium term? See, in medium term, we are likely to maintain card market share. As we have said, our growth guidance is between 10%-15%. And if industry also grows, you would have also seen that the issuance trend in industry has also come down by 50%. So if industry trend also are similar, then we are likely to maintain market share, but we are not into a high growth stage anytime soon. So, Nitin, I'll kind of just add to what Bikram is saying is that I think the focus is not really to continuously add cards for the sake of the cards product. So, for example, if we were acquiring credit card customers who were profitable as a card customer but were probably not relevant for other parts of the bank, we were acquiring such customers. Now we will kind of try and focus more on customers where by definition, one could do multiple products for the bank. So volume shaping in itself is not the primary objective. It is important but not the primary objective. Okay. Sure. So in the Q2, we did see a sharp rise in credit costs in the BFL co-branded cards. And now that we have parting ways, so will this impact the transition of the selection mechanism that was underway and adversely therefore further impact? No, Nitin, the transition actually got completed in July, and therefore, there is no impact at all. Whatever was digested was digested in the transition in Q2, and I think from here on, as I mentioned before and Mr. Kumar mentioned before, we are seeing a continuous trend of improving numbers on slippage. Okay. Last question is for RBL. We still understand that the system is going through a rough phase when you look at the credit card. But for BAF to move away from the partnership, which was doing so well over the years, especially during the recent period, what is driving them to part ways and move away from this partnership? And what is the mix of their total revenue that they make out of this partnership between the spend-based fees and the origination fees? Because origination fees certainly have come down drastically. But spends, if you look at even the current year, are still doing well. So that fee is still continuing. So what is the mix of the two? And any rationale if you can share why have they decided to part ways? So Nitin, honestly, the rationale was quite clear that at some point, the volumes that was coming to BFL from an origination standpoint, basis cross-sell to their customers, was significantly higher, more in the 130, 140, 1.4 lakh range of acquisitions per month. Now, our own, one, the environment, second, our own need to diversify sourcing, etc., meant that that number had to come down. So for example, if we wanted to be in the 20%-30% range maximum per co-brand or even lower, it doesn't mean that we could acquire 5 lakh customers, 5 lakh cards, and BFL will continue to do 1.2, 1.3. So that was not sustainable. So, since the numbers came down and regulations also have moved in a manner in which the activities that can be done by co-brand is now pretty much clearly limited to sourcing, in their mind, the strategic sense came down. For us, it didn't become. It was no more material because the numbers had come down. So, under the circumstances, it was felt by both players that there is no real major merit in continuing this. Got it. Thanks, Jaideep. Wish you all the best. Yeah. Thank you. Thank you. The next question is from the line of Rakesh Kumar from B&K Securities. Please go ahead. Yeah. Hi. Thanks, sir. So just. I'm sorry, sir. We are not able to hear you. Your voice is not clear. I would request you to use your handset, please. Mr. Kumar? As the current participant is not answering, we will move on to the next question, which is from the line of Renish Bhuva from ICICI Securities. Please go ahead. Yeah. Hi, sir. Just two questions from myself. So one, on the renewal, so whenever this card comes for renewal, will we be having the first right to refusal, you or BAF? The card has been issued by RBL then, now, and future also. We are the card-issuing banker. Only the banks can issue the card. They are only co-branding for the limited purpose of sourcing with the customers. Now, when the card is with us, we will renew it in the RBL branded card only instead of a co-branded card. Okay. So the renewal will, let's say, appear to you first and not to BAF? No. No. So the fundamental thing is that Bajaj Finance logically does not have a license to issue cards. So where is this question coming from? We are not able to understand. No. So they have a tie-up with other bank partners as well, right? So. Which we clarified that we understand basis their intimation to us that they are exiting the co-brand credit card business line. Okay. Okay. Got it. Okay. This is very helpful, sir. And secondly, again, in terms of the, let's say, the cross-sell of these 3.4 million cards which are in force, what will be the product per customer and whatever products these cardholders might be having? Is it fair to assume that most of these products will be of BAF portfolio and not from RBL portfolio? See, currently, the RBL products being sold to either BFL-sourced cards or other co-brand or our own other channels is currently negligible. The idea would be to mine these customers for both liabilities and assets over a period of time. Okay. But, sir, any rough idea about whether BAF will be having any cross-sell products to these cardholders? Oh, yeah. BAF would. No mind-blowing things to this. No. No. No. So BAF would definitely have cross-sold products. And not only BAF, there will be other lenders also who would have cross-sold products to these customers. The customer is not captive to anybody. Okay. No, no. Since it is under co-branding, so there might be some agreement that if BAF sells any product to this customer, you might get some fees as well. So I would just. No. No. No. That was not the agreement. No. Okay. Okay. Very clear, sir. Thank you very much, sir. Thank you. Thank you. The next question is from the line of Rakesh Kumar from B&K Securities. Please go ahead. Sir, the question is, what is your thought process herein? I'm sorry to interrupt, sir. Your voice is breaking. We are unable to hear you clearly. Is it clear now? Yes, sir. Much better. Thank you. Yeah. Thanks. So just wanted to understand, sir, the thought process. We are entering into a JV with Mahindra & Mahindra, TVS Finance, and all that. So what kind of customer might we are going to do with the new JVs that we have entered into? Sorry. Your question was not very clearly heard. There was some disturbance in between. Just say this once more, please. I was saying, sir, the new we have entered with Mahindra and TVS Finance. I'm sorry, sir. We are unable to hear you. No, no. I'll just rejoin. Yeah. Yeah. No, no, no. I'll just rejoin. We kind of somewhat understood, Rakesh. Basically, the question, Vikram, is what kind of customer profile? Customer profile. We are trying to look at from the new co-brand partners, both NBFC and non-NBFC, and whatever. So broadly, the customer profile that we are looking at. We are largely looking for credit-tested, mass affluent to affluent customers coming through the new co-brand partners as well as for existing co-brand partners. Those who are tested on bureau for credit profile, we have similar yardstick or credit acceptance criteria for customers coming from, irrespective of which channel they come from. Rakesh, I will add one more to that, that we would so let me give you an example. Let's say there is a customer who logically would be a profitable set of customers for cards but would be, let's say, substantially only a card user type of a profile. And it could be, let's say, a small limit customer or probably a customer who doesn't, on the face of it, have the likes for qualifying for a home loan or other things. So we will want to put those filters in acquisition where we are saying effectively that when we are looking at affluent, mass affluent, we are effectively putting a lens of saying that is this customer potentially viable for multiple RBL Bank products. So we are putting those filters so that the cross-sellable base and the opportunity keeps improving. In short, the volumetric improvement will be one of the major criteria for onboarding these customers. Correct. Absolutely. Sir, just in addition to what I was trying to ask, that what is their experience and capabilities as compared to the previous JV that we had in doing this business for you? So I was coming from that point. Bikram? Yeah. Go ahead, Bikram. Yeah. So the size and scale could be different, but more or less, the new part so if you were to see that we have diversified a new set of partners also, and some of them are market leader in their own space. For example, we have done a tie-up with IOCL. We have done a tie-up with IRCTC, which are only names in that category. Even the NBFCs that we have signed up with, maybe on scale are smaller, but they are going to similar customer profile through similar methods and similar distribution. So they are all maybe on scale, they are different, but from target marketing standpoint, they are same as any other NBFC or same as BFL. Rakesh, unlike the numbers that we originated through BFL in the past, that is neither our expectation nor the partner's expectations in the new scheme of things. Sorry to slightly extend this point, but the kind of customer that BFL could have brought to you, or maybe they will do for someone else now, and the kind of customer that Mahindra and Mahindra will bring to you, wouldn't there be a difference kind of customer they are catering to at present? The texture of the customers, it's very different. So just I'm thinking from that point. This I wanted to take it in two parts, Rakesh. Number one, it is not Mahindra & Mahindra alone. IRCTC and IOCL is also a huge, large customer base, and this will be the hook point, the point on which we will be able to onboard the customer, right? And it is to decide whether this customer is to be onboarded at the very end or not is going to depend on the criteria which we have qualified. That is the value addition. Now, the Bajaj has been doing it for a period of time. They had a larger pool of customers, which we have reduced to 30,000 right now, and we are looking at the replacement of these 30,000 with around four different partners. So four different partners giving a 1 lakh, 2 lakh would have been a challenge, but giving 30,000 of this quality may not be a big challenge. And also, if I were to give you a profile comparison, ex-BFL customers today that we acquire, so I mean, going forward, little over 50% of the customers will come through banks' own branches and sales forces. The co-brand will contribute to little less than 50%, within which also there will be no one co-brand who is having high issuance, as Mr. Kumar has just said. Today, the spend performance of a customer coming through BFL is about 0.65 of what comes through our other channels. Profile, if at all, is likely to get a little better going ahead is what it seems to us. Yeah. With regard to other question, Rakesh, you were telling that they may be sourcing for somebody else. Basis that discussion and dialogue what we had, they are exiting this line of business. Possibly our inference is that they may not be having a tie-up with somebody else. Understood, sir. Understood. Thanks, sir. Thanks so much, sir. Thank you. The next question is from the line of Sandeep Joshi from Unifi Capital. Please go ahead. Yeah. Hi. Good morning. Most of my questions have been answered. I just have one question. Do we need to pay any one-time fee now or after the sunset period to share the real fee as per the agreement? No. No. No one-time fee expected, Sandeep. Basically, no disruption in commercial arrangements in that sense. Okay. And when it is set to share the trail fee, can you disclose it? I don't think there is anything specific here. Safe to say it is not three, six months, as I said. You can easily assume this to be over a two to three-year period at least. Okay. Thanks. Thank you. The next question is from the line of Viral Shah from IIFL Securities. Please go ahead. Hello. Yeah. Thank you for the opportunity. Actually, just had one question. Did the agreement with Bajaj Finance have a non-compete clause? Because as you mentioned that this guy's Bajaj Finance is completely exiting this line of business. And again, this is a hypothetical question, but I'm sure because this was part of the agreement that right now they cannot issue a credit card, but if at all, they by some means could issue that, was that the reason behind this termination? Just trying to get a sense of that. See, by very nature, that they can't issue credit cards. Non-compete is a natural protection that we have. Only banks can issue credit cards. NBFCs are not allowed to do credit cards. Other than that, there are no restrictions on us or them. But through statute only, they are not licensed or authorized to issue credit cards. The agreement did not have the clause of, say, in the event that they get that license, they had a clause of the right to buy out this portfolio? No. Buyout is also not possible as per the regulatory guidelines. The part of the book cannot be sold out. So I want one thing to be understood by you very clearly. When a customer is acquired by any source, the KYC is with the bank. Underwriting, if it is an asset, is with the bank. Management, maintenance, servicing is with the bank. So he becomes literally a customer of the bank. If he is approaching them appropriately for the purpose of any other product which they are supposed to do it, they are free to do it. At the same time, having acquired a customer through any one of these engines, we have all the access for converting them or making them to use our other products. So the probability of we approaching these customers whoever is eligible for other products will definitely reap that particular thing. Normally, what we would like to have is we would like to open the savings account. Through savings account, we will be in a position to offer the multiple products. So our ability to increase the wallet of these credit card customers has increased now. Got it. Makes sense. Thank you. Thank you. The next question is from the line of Raghav from Ambit Capital. Please go ahead. Thanks again for the opportunity and apologies for harping on this point again. If I look at your total card fee income, the proportion that is retained by you, would it be similar to your share of the direct sourced fees on the card than for co-brand? Is that correct? Is that understanding correct? Because I was going through one of your past transcripts, you had mentioned that the fee income split is broadly similar to the proportion of the business which is sourced directly by you and otherwise. No, Raghav, what we have said repeatedly in the past is that if we look at the PBT ROAs of the Bajaj co-branded portfolio and the rest of the portfolio across multiple co-brands and self-origination, they are roughly similar. And this is, of course, after paying out whatever has to be paid out to BFL. And that continues. Understood. That's clear. Thank you. That's all. Yeah. Ladies and gentlemen, we now conclude the Q&A session. If you have any further questions, please contact RBL Bank Limited via email at ir@rblbank.com. I repeat, ir@rblbank.com. Thank you, members of the management. On behalf of RBL Bank Limited, we thank you for joining us, and you may now disconnect your lines. Thank you. Thank you. Thank you, Michelle. Thank you. Thank you, sir.