A PwC report predicts that the number of credit cards in India will reach 200 million by FY28-29, driven by a compound annual growth rate (CAGR) of 15%. Over the past five years, the credit card industry has doubled the number of issued cards, and similar growth is expected in the coming years.
The report highlights a significant increase in credit card transactions, with volumes rising by 22% and transaction values increasing by 28%. This growth is attributed to new products, innovative offerings, and the expansion of customer segments.
Meanwhile, debit card usage has declined, with transaction volumes dropping by 33% and spending falling by 18% in FY23-24. This trend is primarily due to the growing popularity of the Unified Payments Interface (UPI), which is preferred for its ease of use and zero Merchant Discount Rate (MDR), making it attractive to small and medium-sized merchants. Debit cards have also struggled to compete with credit cards due to less appealing reward programs.
On the other hand, digital payments in India have seen rapid growth, with transaction volumes up 42% year-on-year in FY23-24, and this trend is expected to triple by FY28-29. The report credits this rise to innovations in the payment ecosystem, new business models, and increased customer awareness.
