RuPay rises despite merchant pushback; will govt patronage continue as elections loom?


Sohini Mitter

23 reads

Sohini Mitter

23 reads

RuPay credit cards continue to gain ground, with monthly spending crossing the Rs 10,000-crore mark in December. Fintech experts say the government’s focus on establishing RuPay as India’s leading card network would gain further impetus ahead of the upcoming elections. But, some issues remain.

January 31, 2024


Key Takeaways

  • RuPay credit cards are growing in usage, riding on the availability of UPI linking as well as merchant rewards and offers
  • Almost 11 of India's top public and private banks have jumped onto the 'credit card on UPI' bandwagon; some are even issuing corporate credits cards on RuPay
  • The government sees RuPay as India's answer to the "US hegemonies" of VISA, Mastercard, and Amex, and will continue to push adoption
  • RuPay is expected to feature prominently in the lead-up to the elections as the government pitches indigenous technologies more strongly

RuPay—India’s homegrown card network operated by the National Payments Corporation of India (NPCI)—scaled new heights in December 2023, with monthly credit card spending surpassing Rs 10,000 crore for the first time. UPI-linked RuPay cards, which have driven adoption of the indigenous card network in the past one year, accounted for roughly 50% of this, according to RBI’s latest card bulletin.

RuPay’s share of overall monthly credit card spending (which stood at Rs 1,65,000 crore in December) has also doubled from 3% to 6% in a little more than a year. Additionally, the total number of RuPay cards in circulation crossed the 10-million mark, taking the network’s share of India’s credit card market up to 10.2%. (For context, there were 98 million active credit cards at the end of 2023, per RBI, with this number expected to cross the 100-million milestone this month.)

The ubiquity of UPI—which processed payments worth Rs 18,23,000 crore in December—along with RBI’s October 2023 draft circular that lets users choose their preferred card network if their bank is offering a card in multiple variants, are among the factors driving RuPay adoption across the country.

Not only are customers warming up to merchant offers and rewards on these cards, they’re also relishing the 45-to-50-day interest-free credit period and UPI’s multi-platform compatibility.

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