India Credit Card Help Guide

Credit Card Help Guide

India Mobile Payment & Fintech Platforms Preparing for IPO

by

With a huge population and its affinity towards the mobile / smartphones, India is one of the most attractive market for fintech disruption driven by increasing high speed internet penetration. Penetration of digital C2B [Consumer 2 Business] payments (cards, UPI, wallets) is expected to increase multi-fold to touch 1/3rd of the transactions by 2025. UPI payments are expected to grow at ~50% CAGR driven by UPI QR payments for merchants. Debit Cards & Credit cards are expected to grow at ~23% CAGR. Overall share of UPI is expected to increase 50-55% of digital payments by 2025, while cards would be 40-45%.

Sensing this opportunity a decade ago, Vijay Shekar Sharma ventured to found Paytm, the leading mobile payment platform with 150-200 Mn active users and 15+ Mn merchant having adopted the payments channel with 120,000 using its PoS terminals. Ambitions didn’t stop for Sharma backed by Venture capitalists such as Softbank, ANT Financials and

Read moreIndia Mobile Payment & Fintech Platforms Preparing for IPO

Indians embrace Digital Payments – JAM Pays Off

by

The Government of India’s push for digital transactions which started from 2016 using JAM trinity (JanDhan, Aadhar and Mobile) is helping in changing the consumer preference structurally. This structural shift in the consumer preference will also help the credit card industry going forward.

Credit Card outstanding in India is just ~6% of debit card spends and this has not improved meaningfully in recent times. If we look at the composition of digital transaction over

Read moreIndians embrace Digital Payments – JAM Pays Off

Credit Cards – Under Penetrated, 4 Bn Dollar Profit Center for Next Decade

by

Over the next decade, the Indian domestic credit card sector offers an annual profit pool of $4bn (10% of banking sector profit), primarily driven by rising penetration (new customers) as the product segment remains highly under-penetrated. To put this in context, TransUnion CIBIL estimates that only 25% of the adult population in India is currently credit-active.

India currently has just 45.2mn credit cards outstanding compared to 931mn debit cards. CIBIL database indicates ~210mn customers having score of 700+ (prime / prime plus customers). Changing consumer behaviour/preference toward consumption/personal loans

Read moreCredit Cards – Under Penetrated, 4 Bn Dollar Profit Center for Next Decade

The Business of Credit Card in India Today – Part 1

by

The credit card base has grown at a 18% CAGR during FY14-FY18, the current credit card base is only 45mn – this compares to 210mn customers with a 700+ CIBIL score (Super-Prime, Prime Plus and Prime), implying a 20% penetration and massive headroom for growth while staying on the same risk curve.

2 Big Credit Card Business Models in India The primary business model is centered on internal-to-bank customers (in practice at larger banks) while a secondary business model is emerging around new-to-bank customers (in practice at mid-sized banks). Large banks with a sizeable customer franchise grow their credit card portfolio purely as a cross-sell offering to their

Read moreThe Business of Credit Card in India Today – Part 1

Micro Payments and Small Merchants – Next Big Story

by

The Payment ecosystem in India comprised of (1) RTGS for high value payments – Corporate and Government, (2) NEFT/NACH for low value payments, that mainly supported Salary and SME Business. In recent years, the micro-value payments segment has seen the introduction of a number of products like digital wallets, UPI etc. This has driven the lower end of the pyramid to the payments ecosystem, fulfilling the
government’s financial inclusion objective.

Growth of UPI – The value of transactions through UPI surpassed that of cards last year at ~Rs120 tn. This was in part driven by incentivization in the form of cashbacks etc. and hence is expected to moderate slightly from these levels as

Read moreMicro Payments and Small Merchants – Next Big Story

Keya – AI Bot – Kotak Mahindra Bank – Consumer Experience Review

by

Kotak Mahindra Bank the bank for today’s genNext has embraced Digital Banking solutions more than any other bank in India. I had logged on to pay my Credit Card Bill and for some reason the Web Services on their online portal was non-responsive and I got the error message “Server is Down, Please Re-Login after Sometime.”

Before I decided to try again after sometime, “Keya – the AI Bot of Kotak Mahindra Bank” caught my attention and I decided to interact with her. Here is my Conversation and completion of transaction of

Read moreKeya – AI Bot – Kotak Mahindra Bank – Consumer Experience Review