July 25 – India’s card payments market is expected to experience substantial growth in 2024, with a forecasted increase of 11.3%, reaching Rs 28.4 trillion (USD 344 billion), according to GlobalData, a data and analytics company. This growth is driven by a rising consumer preference for non-cash payments and supportive government initiatives aimed at promoting financial inclusion and the adoption of electronic payments.
GlobalData’s Payment Cards Analytics highlights a positive trend in card payments across India. In 2022, the market saw a significant 27.1% increase in card payment value, fueled by a surge in consumer spending. This momentum continued into 2023, with a 13.1% growth, bringing the total card payment value to Rs 25.5 trillion (USD 309.2 billion). Ravi Sharma, Lead Banking and Payments Analyst at GlobalData, emphasized the impact of declining cash usage and increasing consumer confidence in electronic payments.
“India’s card payments market continues to grow as cash usage declines. The government’s initiatives, along with rising consumer confidence in electronic payments, have paved the way for the growth of card payments in the country,” Sharma stated.
Government efforts to promote financial inclusion, particularly through programs like the Pradhan Mantri Jan-Dhan Yojana (PMJDY), have been significant contributors to this growth. The PMJDY program aims to provide low-cost bank accounts and debit cards, especially targeting the rural population. Additionally, reductions in merchant service fees have further encouraged the shift from cash to card-based transactions.
While debit cards remain the most common type of card in India, credit and charge cards accounted for a substantial 75.7% of the total card payment value in 2023. The popularity of these cards is largely due to benefits such as reward points, discounts, and installment payment options. The rise of e-commerce has also played a crucial role in the growth of card payments, with payment cards, including debit, credit, and charge cards, collectively representing 24.6% of the total e-commerce transaction value in 2023, according to GlobalData’s 2023 Financial Services Consumer Survey.
To support the expansion of electronic payments, the Reserve Bank of India (RBI) established the Payments Infrastructure Development Fund (PIDF) in January 2021. The fund aims to deploy one million Point of Sale (POS) devices and enhance QR code payment acceptance across merchants. By November 2023, the initiative had successfully deployed 827,901 POS terminals and 27.2 million QR code acceptance points. The program, initially set to end in 2023, has been extended to December 2025.
Looking forward, the outlook for India’s card payments market remains highly optimistic. The market is projected to register a strong compound annual growth rate (CAGR) of 11.1% from 2024 to 2028. Key drivers of this growth include ongoing government efforts to promote financial inclusion and electronic payments, improvements in payment infrastructure, and the expanding e-commerce sector.
Sharma concluded, “The forecast for India’s card payments market is promising, with significant growth expected over the forecast period, driven by government initiatives, improved payment infrastructure, and the growth of e-commerce.”
