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 India's central bank on Wednesday said issuers of credit cards shall not enter into any arrangement or agreement with card networks that restrain customers from availing the services of other networks.

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

Card issuers are required to provide an option to their eligible customers to choose from multiple card networks at the time of issue, the central bank said.

For existing cardholders, this option may be provided at the time of the next renewal, it added.

Networks of American Express, Diners Club International, Mastercard, Visa and homegrown RuPay provide services to customers in India, but the provider is usually predetermined by the bank depending on the card issued.

Card issuers and networks will have to ensure adherence to the RBI's guidelines in existing agreements at the time of amendment or renewal and when fresh agreements are executed, the central bank further said.

"Currently, customers are required to send a letter to ask for a switch in card network," said a banker with a private bank.

"Now, that choice will become mandatory for issuers to offer at the time of issuance and renewal."