 "Jan Dhan helps debit card base jump 40 per cent")
The increased focus on growing the unsecured lending base and extending banking services to the unbanked under the Pradhan Mantri Jan Dhan Yojana has led to a growth in both debit and credit card base in the system.
Debit cards that have been growing at a compounded annual growth rate of 20.7 per cent in the last few years, grew by 40 per cent in FY15 according to a Wordline report, a player in the payments and transactional services. “The last year saw a big jump in the opening of bank accounts as a result of the Jan Dhan scheme and as a result the debit card usage also increased substantially,” explained Deepak Chandnani, chief executive officer, South Asia & Middle East, Worldline India.
In the debit card space, it was the public sector banks (PSBs) which have managed to grow the market share. According to the report, PSBs have grown in market share by three per cent to 83 per cent from last year. On the other hand private bank have 16 per cent market share where as foreign banks have only 1 per cent share in the debit card base.
In the credit card space, the growth in user base was more modest at 9.8 per cent. Private sector banks continue to be the largest issuer of credit cards with 57 per cent share. Foreign banks lost about four per cent market share and their market share slid from 26 per cent in FY14 to 22 per cent in FY15.
HDFC Bank continued to be the market leader in the credit card space with a share of 28 per cent. While HDFC Bank and Axis Bank gained 1 per cent market share in FY15 as compared to a year earlier, ICICI Bank lost 1 per cent market share in the same period. SBI managed to hold on to 15 per cent share, same as FY14. However, both foreign banks — Citibank & Standard Chartered — lost market share.
On a year-on-year basis, debit card transactions grew at 30 per cent in FY15 whereas credit card transactions grew by 23 per cent. The average ticket size for transactions was recorded at Rs 3,089 whereas for credit cards it stood at Rs 1,502.
Chandnani believes that in this financial year growth in credit cards may climb up to double digits. “There are signs that the economy may improve and as a result banks will be focusing more on credit card and unsecured lending. Therefore in this financial year we expect credit card growth to be better.”
But on the other hand debit card growth may come down to the 20 per cent levels that we have seen earlier.”
Even at a time when the card usage and spend continues to increase, the growth in Point Of Sales (PoS) slowed down. As per the report, growth in PoS terminal in FY15 was at only 6 per cent compared to a 26 per cent growth witnessed in FY14. Similar to the credity card space, even in the PoS space it is the private banks that continue to lead the charts.
However, even the state-owned lenders are quickly grabbing market share from the private banks. With an increased focus, especially from SBI, PSBs have managed to gain 6 per cent market share from private banks.
Debit cards that have been growing at a compounded annual growth rate of 20.7 per cent in the last few years, grew by 40 per cent in FY15 according to a Wordline report, a player in the payments and transactional services. “The last year saw a big jump in the opening of bank accounts as a result of the Jan Dhan scheme and as a result the debit card usage also increased substantially,” explained Deepak Chandnani, chief executive officer, South Asia & Middle East, Worldline India.
In the debit card space, it was the public sector banks (PSBs) which have managed to grow the market share. According to the report, PSBs have grown in market share by three per cent to 83 per cent from last year. On the other hand private bank have 16 per cent market share where as foreign banks have only 1 per cent share in the debit card base.
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With the other players becoming aggressive, State Bank of India — country’s largest lender — lost four per cent market share in debit card space but still has the maximum share in the market at 29 per cent.
In the credit card space, the growth in user base was more modest at 9.8 per cent. Private sector banks continue to be the largest issuer of credit cards with 57 per cent share. Foreign banks lost about four per cent market share and their market share slid from 26 per cent in FY14 to 22 per cent in FY15.
HDFC Bank continued to be the market leader in the credit card space with a share of 28 per cent. While HDFC Bank and Axis Bank gained 1 per cent market share in FY15 as compared to a year earlier, ICICI Bank lost 1 per cent market share in the same period. SBI managed to hold on to 15 per cent share, same as FY14. However, both foreign banks — Citibank & Standard Chartered — lost market share.
On a year-on-year basis, debit card transactions grew at 30 per cent in FY15 whereas credit card transactions grew by 23 per cent. The average ticket size for transactions was recorded at Rs 3,089 whereas for credit cards it stood at Rs 1,502.
Chandnani believes that in this financial year growth in credit cards may climb up to double digits. “There are signs that the economy may improve and as a result banks will be focusing more on credit card and unsecured lending. Therefore in this financial year we expect credit card growth to be better.”
But on the other hand debit card growth may come down to the 20 per cent levels that we have seen earlier.”
Even at a time when the card usage and spend continues to increase, the growth in Point Of Sales (PoS) slowed down. As per the report, growth in PoS terminal in FY15 was at only 6 per cent compared to a 26 per cent growth witnessed in FY14. Similar to the credity card space, even in the PoS space it is the private banks that continue to lead the charts.
However, even the state-owned lenders are quickly grabbing market share from the private banks. With an increased focus, especially from SBI, PSBs have managed to gain 6 per cent market share from private banks.