Of the 369 million debit and credit cards in the country, 10-15% are used only for online transactions, the Reserve Bank of India (RBI) has said.
India is one of the fastest-growing countries in the plastic money segment, with close to 350 million debit cards and 19 million credit cards in circulation.
“Credit cards have a higher share in the discretionary category whereas debit cards dominate in routine expenses like utility payments. About 30% of credit card spends are being done online. At least 10-15% of customers use their cards only online, many from smaller cities,” the central bank said in a report.
The RBI quoted studies of two major payment networks — MasterCard and Visa.
According to MasterCard, 75% of all card payments are concentrated in top 20 cities with Delhi, Mumbai and their suburbs alone accounting for 43%. A Visa study reveals that people in the monthly income band of R75,000-1,00,000 are the most prolific users of electronic cards.
The RBI said electronic payments dominate their expenses: rail/airfare (71%), durable goods (61%), rent (49%), tele/mobile (47%), medical institutions (46%), clothing/footwear (44%), beverages and refreshments (35%).
“Card payments form an integral part of e-payments in India because customers make many payments on their card — paying their bills, transferring funds and shopping,” said the RBI report on ‘Enabling Public Key Infrastructure (PKI) in Payment System Applications’.