The Life Insurance Corporation of India is believed to be talking with GE Capital Services, the largest issuer of private label credit cards in the world, for a foray into credit cards.

A source close to the development said talks are at a preliminary stage with other companies also. However, GE is the frontrunner.

Sources said LIC [Get Quote] is likely to get into a three-way venture with a bank. The sources did not rule out the entry of Corporation Bank [Get Quote] in the venture.

GE already has a tie up with the State Bank of India [Get Quote] in credit cards. However, a possible conflict of interest will be avoided by formulating a detailed code of conduct prohibiting sharing of business information.

Last year, LIC had roped in consulting firm KPMG to script roadmap to enter the credit card business.

The mandate given to KPMG was to find out whether foraying into the credit card business will help its policyholders and whether the agents could use their time in a better way by selling credit cards and also doing so, would enhance its brand reputation.

The objective of setting up a credit card business is that LIC can leverage its data on policyholders' credit worthiness and competitively price the card.

The potential of credit cards' business in India is huge given that credit card spend, as a proportion of the total expenditure, by Indians is still one of the lowest in the world.