Credit Card E-spends Beat Swipes by 76%

Mumbai: Credit card spending online by Indians outstrips the value of in-store swipes by 76%. Data released by the RBI shows that Indians predominantly use their credit cards online for payments, while debit cards are more used for physical stores. The RBI data provides for the first time a break-up of online versus in-store payments, which explains the regulator’s concerns over risks involved in online usage.

According to the data for March 2022, 7.3 crore credit cardholders spent Rs 68,327 crore online as against the Rs 38,773 crore used for making payments in stores using card-swipe machines. In terms of the number of transactions, there is not much difference with 11.1 crore offline credit card transactions versus 11 crore online transactions.

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Debit cards, however, tell a slightly different story. The 91.7 crore debit cards active in India were used for 20.8 crore transactions in stores and for 11.9 crore transactions online. This means that roughly one in five debit cards were used for payments in stores and little more than one in 10 were used for online payments. In terms of the value of transactions, Rs 40,831 crore was spent in stores, while Rs 22,687 crore was spent online.

Data on credit and debit cards released by the RBI for the month of March 2022 shows that banks increased their card base by 6.2 crores to 7.3 crores in 12 months. The 1.1-crore addition resulted in an 18% growth in the card base. The highest addition came from ICICI Bank, which grew its card base by 22.5% to 1.3 crore cards. In terms of absolute growth, State Bank of India came in second adding 19 lakh cards and recording a 16% growth to 1.37 crores. Axis Bank grew its card base 26% to 90 lakh cards.

In terms of card additions, HDFC Bank, the largest player, ranked fourth due to an RBI ban on adding new customers for nearly eight months. This resulted in the card base growing only 10% to 1.65 crore. Kotak Mahindra was the fastest-growing among the top five by adding 7.8 lakh cards and taking its card base to 31.9 lakh — an increase of 32.6%. IDFC Bank, which launched its differential card product, managed to add 5.6 lakh cards, takings its base to nearly 8 lakh cards.

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SBM Bank, which has successfully partnered fintech firms, made it to the top 10 with 5.6 lakh cards. Bank of Baroda added 4.6 lakh cards and ended the year with 11 lakh cardholders.

Foreign banks lost the most in FY22, led by American Express which faced a ban from the RBI on onboarding new customers until it complied with norms pertaining to storage of data. Amex ended FY22 with 13.8 lakh cards — a decline of 1.5 lakh users. Stanchart lost 1.3 lakh card users and ended the year with 13.4 lakh cards. Citibank lost 82,096 customers and ended the year with 25.5 lakh cards. (Time of India)