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The difference between issuing a card for an account holder and non-holder, is you can not control their balance, thus possibility of default is higher.
Thank you for your kind invitation
Issuance of credit cards to clients do not have bank accounts have not yet beenpreparing well inquire about them and no doubt there was a risk of non-repayment, but is a calculated risk when issuing those cards, for example, some banks issue insurance policies cover the customer's obligations in the event of non-payment
NG MY INVITING ME....
THE BANKS NOW CONDUCT KYC PROCESS TO AND UNDERSTAND THE CUSTOMERS CREDIT TURN OVER AND E-CIB FROM STATE BANK REFLECTS HIS BORROWING FROM OTHER REQUESTED TO OPEN BANK ACCOUNT BUT NOT NECESSARY HE MAY GET CREDIT CARD WITHOUT HAVING OPENED BANK ACCOUNT THE BANK COVERS INSURANCE AGAINST THE SAID CUSTOMER AND ESCROW ACCOUNT IS ALSO ESTABLISHED IF NECESSARY...
It's a risk and banks' Risk Management has to deal with it by mitigating this risk. Banks can use insurance policies for mitigating this risk. Also, the KYC and customer investigation made by banks before issuing credit cards to their customers is one of the key elements for managing and mitigating the risk.
At the end, this kind of risk comes under counterparty credit risk and all laws and regulations have put in place some rules to reduce these contractual violation cases.
Thanks , due lack of knowledge as well as experience in this side , I regret unable to be of assistance.
Best wishes.
The risk is mitigated by
1. Acquiring a 120% (or greater) cash margin
2. Enhanced due diligence on the customer
3. Acquiring an insurance coverage on the potential loss
