The Cards and Payments Industry in India: Emerging Trends and Opportunities to 2021

Nov, 2016   |   68  Pages   |   GlobalData   |   Format : PDF

Summary

GlobalData’s "The Cards and Payments Industry in India: Emerging Trends and Opportunities to 2021", report provides detailed analysis of market trends in the Indian cards and payments industry. It provides values and volumes for a number of key performance indicators in the industry, including credit transfers, direct debit, cash, payment cards and checks during the review period (2012-2016).

The report also analyzes various payment card markets operating in the industry, and provides detailed information on the number of cards in circulation, transaction values and volumes during the review period and over the forecast period (2017-2021). It also offers information on the country's competitive landscape, including the market shares of issuers and schemes.

The report brings together GlobalData’s research, modeling, and analysis expertise to allow banks and card issuers to identify segment dynamics and competitive advantages. The report also covers details of regulatory policy and recent changes in the regulatory structure.

The report also provides top-level market analysis, information and insights into the Indian cards and payments industry, including -
- Current and forecast values for each market in the Indian cards and payments industry, including debit, credit and charge cards.
- Detailed insights into payment instruments including credit transfers, direct debit, checks, cash and payment cards. It also, includes an overview of the country's key alternative payment instruments.
- E-commerce market analysis and payment methods.
- Analysis of various market drivers and regulations governing the Indian cards and payments industry.
- Detailed analysis of strategies adopted by banks and other institutions to market debit, credit and charge cards.

Scope

- To tackle the issue of ‘black’ money and counterfeit currency, the Indian government decided to cancel the legal tender of the high-denomination INR500 and INR1,000 from midnight of November 2016; these are now being replaced with new notes. These notes account for more than 85% of the total currency in circulation in value terms, and the move has resulted in a shortage of cash as a result of logistical issues in making the new notes available. The shortage of cash is expected to encourage the use of payment card and digital wallets in the country. Furthermore, this will bring overall change in consumers’ mindset and payment habits and drive electronic payments.
- Competition in the Indian alternative payments market has increased, with payment service providers (PSPs), banks and mobile operators all offering solutions. For instance, State Bank of India (SBI) launched the State Bank Buddy digital wallet in August 2015; as of March 2016, 4.8 million transactions worth US$35.1 million (INR2.3 billion) had been made, of which US$1.8 million (INR114.7 million) were at merchant outlets. Other digital wallets launched by banks were Pockets by ICICI Bank in February 2015, and Lime by Axis Bank in September 2015. PSPs offering payment solutions include Paytm, Oxigen wallet and FreeCharge. India-based mobile operator Bharti Airtel launched its mobile money service, airtel money, in February 2012.
- The emergence of mobile-only banks is likely to accelerate the shift towards electronic payments in India. Singapore-based DBS Bank launched India’s first mobile-only bank, digibank, in April 2016; the zero-balance savings account comes with a Visa debit card. Customers are entitled to an unlimited number of cash withdrawals, and are offered cashback and discounts on in-store and online purchases. Customers can open accounts at any of the bank’s partner outlets simply by giving Adhar Card details and biometrics for authentication.

Reasons to buy

- Make strategic business decisions, using top-level historic and forecast market data, related to the Indian cards and payments industry and each market within it.
- Understand the key market trends and growth opportunities in the Indian cards and payments industry.
- Assess the competitive dynamics in the Indian cards and payments industry.
- Gain insights into marketing strategies used for various card types in India.
- Gain insights into key regulations governing the Indian cards and payments industry.

Table of Contents
1 EXECUTIVE SUMMARY 2
1.1 Market overview 2
1.2 Key facts 4
1.3 Top five industry events 5
2 PAYMENT INSTRUMENTS 11
2.1 Current payment environment 11
3 E-COMMERCE AND ALTERNATIVE PAYMENTS 13
3.1 E-Commerce market analysis 13
3.2 Alternative payment solutions 15
3.2.1 PayPal 15
3.2.2 Paytm 15
3.2.3 State Bank Buddy 15
3.2.4 Oxigen wallet 15
3.2.5 airtel money 16
3.2.6 MasterPass 16
3.2.7 FreeCharge 16
3.2.8 PayZapp 16
3.2.9 PayU 16
3.2.10 Pockets 17
3.2.11 Lime 17
3.2.12 MobiKwik 17
4 REGULATIONS IN THE CARDS AND PAYMENTS INDUSTRY 18
4.1 Regulatory framework 18
4.2 Anti-money laundering (AML) 20
4.3 Foreign direct investment (FDI) regulations 20
5 ANALYSIS OF CARDS AND PAYMENTS INDUSTRY DRIVERS 22
6 PAYMENT CARDS 25
7 DEBIT CARDS 27
7.1 Debit cards market analysis 27
7.2 Competition in the debit cards market 29
7.3 Debit cards comparison 31
8 PAY LATER CARDS 32
8.1 Pay later cards market analysis 32
8.2 Competition in the pay later cards market 34
8.3 Pay later cards comparison 36
9 CARD ISSUERS 39
9.1 State Bank of India 39
9.2 HDFC Bank 40
9.3 ICICI Bank 41
9.4 Axis Bank 42
9.5 Punjab National Bank 43
10 PREPAID CARDS 44
11 MERCHANT ACQUIRING 46
12 APPENDIX 49
12.1 Tables 49
12.2 Definitions 64
12.3 Methodology 65

List of Tables
Table 1: India - Key Facts, 2016 4
Table 2: Regional Benchmarking of the Indian Payment Cards, 2016 4
Table 3: Paytm Fact Sheet, October 2016 15
Table 4: India - Mode of Entry of Foreign Banks 21
Table 5: India - Debit Cards Comparison and Key Features, 2016 31
Table 6: India - Gold Credit Cards Comparison and Key Features, 2016 36
Table 7: India - Premium Credit Cards Comparison and Key Features, 2016 37
Table 8: India - Charge Cards Comparison and Key Features, 2016 38
Table 9: India - Payment Instrument Transaction Values (INR Trillion), 2012-2016 49
Table 10: India - Payment Instrument Transaction Values (US$ Billion), 2012-2016 49
Table 11: India - Payment Instrument Transaction Volumes (Million), 2012-2016 49
Table 12: India - Number of Payment Cards in Circulation by Type (Million), 2012-2021 50
Table 13: India - Volume of Payment Card Transactions by Type (Million), 2012-2021 50
Table 14: India - Value of Payment Card Transactions by Type (INR Billion), 2012-2021 50
Table 15: India - Value of Payment Card Transactions by Type (US$ Billion), 2012-2021 50
Table 16: India - Number of Debit Cards in Circulation (Million), 2012-2021 50
Table 17: India - Debit Card Transaction Volumes and Frequency by Channel, 2012-2021 51
Table 18: India - Debit Card Total and Average Transaction Values by Channel, 2012-2021 51
Table 19: India - Debit Card Total and Average Transaction Values by Channel, 2012-2021 51
Table 20: India - Number of Debit Cards in Circulation by Scheme (Million), 2012-2016 52
Table 21: India - Debit Card Transaction Values by Scheme (INR Trillion), 2012-2016 52
Table 22: India - Debit Card Transaction Values by Scheme (US$ Billion), 2012-2016 52
Table 23: India - Debit Card Transaction Values by Issuer (INR Trillion), 2012-2016 52
Table 24: India - Debit Card Transaction Values by Issuer (US$ Billion), 2012-2016 53
Table 25: India - Number of Pay Later Cards in Circulation (Million), 2012-2021 53
Table 26: India - Pay Later Card Transaction Volumes and Frequency by Channel, 2012-2021 53
Table 27: India - Pay Later Card Total and Average Transaction Values by Channel, 2012-2021 54
Table 28: India - Pay Later Card Total and Average Transaction Values by Channel, 2012-2021 54
Table 29: India - Number of Pay Later Cards in Circulation by Scheme (Million), 2012-2016 54
Table 30: India - Pay Later Card Transaction Values by Scheme (INR Billion), 2012-2016 55
Table 31: India - Pay Later Card Transaction Values by Scheme (US$ Billion), 2012-2016 55
Table 32: India - Pay Later Card Transaction Values by Issuer (INR Billion), 2012-2016 55
Table 33: India - Pay Later Card Transaction Values by Issuer (US$ Billion), 2012-2016 55
Table 34: India - Number of Credit Cards in Circulation (Million), 2012-2021 56
Table 35: India - Credit Card Transaction Volumes and Frequency by Channel, 2012-2021 56
Table 36: India - Credit Card Total and Average Transaction Values by Channel, 2012-2021 56
Table 37: India - Credit Card Total and Average Transaction Values by Channel, 2012-2021 57
Table 38: India - Number of Credit Cards in Circulation by Scheme (Million), 2012-2016 57
Table 39: India - Credit Card Transaction Values by Scheme (INR Billion), 2012-2016 57
Table 40: India - Credit Card Transaction Values by Scheme (US$ Billion), 2012-2016 57
Table 41: India - Number of Charge Cards in Circulation (Thousand), 2012-2021 58
Table 42: India - Charge Card Transaction Volumes and Frequency by Channel, 2012-2021 58
Table 43: India - Charge Card Total and Average Transaction Values by Channel, 2012-2021 58
Table 44: India - Charge Card Total and Average Transaction Values by Channel, 2012-2021 59
Table 45: India - Number of Charge Cards in Circulation by Scheme (Thousand), 2012-2016 59
Table 46: India - Charge Card Transaction Values by Scheme (INR Billion), 2012-2016 59
Table 47: India - Charge Card Transaction Values by Scheme (US$ Billion), 2012-2016 59
Table 48: India - Personal and Commercial Pay Later Card Transaction Volumes (Million), 2012-2021 59
Table 49: India - Personal and Commercial Pay Later Card Transaction Values (INR Billion), 2012-2021 60
Table 50: India - Personal and Commercial Pay Later Card Transaction Values (US$ Billion), 2012-2021 60
Table 51: India - Number of Commercial Pay Later Cards in Circulation (Thousand), 2012-2021 60
Table 52: India - Commercial Pay Later Card Transaction Volumes (Million), 2012-2021 60
Table 53: India - Commercial Pay Later Card Transaction Values (INR Billion), 2012-2021 60
Table 54: India - Commercial Pay Later Card Transaction Values (US$ Billion), 2012-2021 60
Table 55: India - Number of Prepaid Cards in Circulation (Million), 2012-2021 61
Table 56: India - Prepaid Card Transaction Values (INR Billion), 2012-2021 61
Table 57: India - Prepaid Card Transaction Values (US$ Billion), 2012-2021 61
Table 58: India - Merchant Acquiring Transaction Volumes (Billion), 2012-2021 61
Table 59: India - Merchant Acquiring Transaction Values (INR Trillion), 2012-2021 61
Table 60: India - Merchant Acquiring Transaction Values (US$ Billion), 2012-2021 61
Table 61: India - Acquirers’ Transaction Volumes (Million), 2012-2015 62
Table 62: India - Acquirers’ Transaction Values (INR Billion), 2012-2015 62
Table 63: India - Acquirers’ Transaction Values (US$ Billion), 2012-2015 62
Table 64: India - Retail Outlets and Card Accepting Merchants (Million), 2012-2021 62
Table 65: India - Debit Card, Average Interchange Fees: Intra-Network Transactions (%), 2012-2016 63
Table 66: India - Debit Card, Average Merchant Service Charge and Interchange Fee (%), 2012-2021 63
Table 67: India - Pay Later Card, Average Interchange Fees: Intra-Network Transactions (%), 2012-2016 63
Table 68: India - Pay Later Card, Average Merchant Service Charge and Interchange Fee (%), 2012-2021 63
Table 69: Key Definitions 64
Table 70: Annual Average Exchange Rate 66

List of Figures
Figure 1: India - Payment Instrument Shares by Transaction Value (%), 2012 vs 2016 11
Figure 2: India - Payment Instrument Shares by Transaction Volume (%), 2012 vs 2016 12
Figure 3: India - E-Commerce Value, 2012-2021 13
Figure 4: India - E-Commerce Payment Methods, 2016 13
Figure 5: India - Population 22
Figure 6: India - Economic Indicators 23
Figure 7: India - ATMs and POS Terminals 23
Figure 8: India - Household Consumption 24
Figure 9: India - Growth in Payment Cards Transaction Values, 2012-2021 25
Figure 10: India - Number of Cards in Circulation by Type, 2012-2021 26
Figure 11: India - Debit Card Penetration, 2016 27
Figure 12: India - Turnover Per Debit Card, 2016 28
Figure 13: India - Debit Card Scheme Share in Terms of Transaction Value, 2016 29
Figure 14: India - Debit Card Issuer Share in Terms of Transaction Value, 2016 30
Figure 15: India - Pay Later Cards Penetration, 2016 32
Figure 16: India - Turnover Per Pay Later Card, 2016 33
Figure 17: India - Pay Later Cards Scheme Share in Terms of Transaction Value, 2016 34
Figure 18: India - Pay Later Cards Issuer Share in Terms of Transaction Value, 2016 35
Figure 19: India - Number of Prepaid Cards in Circulation, 2012-2021 44
Figure 20: India - Prepaid Cards Transaction Value, 2012-2021 44
Figure 21: India - Merchant Acquiring Transaction Volume and Value, 2012-2021 47
Figure 22: India - Acquirers’ Market Share in Terms of Transaction Volume and Value (%), 2015 47
Figure 23: India - Average Merchant Service Charge and Interchange Fee (%), 2012-2021 48

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