Credit Card: The Resistance, Acceptance, and Growth In India

HSBC Bank introduced the concept of ATM in India in 1987 and since then, the ATM and Debit Cards have been multiplying in numbers. All because of the convenience factor that gives the assurance to the people of a comfortable experience without wasting much time. Now unlike debit cards, the concept of credit cards was not initially accepted by Indian citizens. It was a big no-no, and there are still people who are still not aware of the benefits of a credit card.

Today might be a different story which is much clearer and for a brighter future. Credit Cards are now evolving rapidly and almost every financial institution in India has tens of credit cards to offer with hoards of benefits on the plate.

Credit Cards were first introduced by American Express in 1958 to give more flexible payment options to people. In India, credit Cards were introduced in 1961 By Kali Mody and Indian businessmen.

In 1980, the Central Bank Of India brought the first bank Credit Card followed by different banks after that. But the Credit Card was issued to only a selected category of citizens who fall under the minimum annual range criteria.

It was a Big NO In India

Initially, it was a big NO for Credit Cards in India. Unlike debit cards, Credit cards were not accepted by Indian citizens for a long time. In the starting years, since the launch of credit cards, the popularity and use of credit cards suffered a lot by the anti-credit mindset of the people. Many people were scared to accept credit cards due to the thought of the high-liability factor and in the future unable to pay to repay. This made people think twice since the consequences of delaying or defaulting the credit payment were harsh.

The feature of spend now and pay later was the one that lured people to finally accept the credit card concept. Though the credit card was introduced in India in the early 80s, the boom in its market was much awaited.

Increasing Popularity and Welcoming the Concept

Gradually, people started gaining interest in Credit Cards, as the use of modern technology was vast. Also, the increase in people’s incomes played a major part. The use of Credit Cards spread across various sections from businessmen to individuals. That was the beginning of the growth of Credit cards in the Indian Economic market. Indian Credit market later started booming with a limited choice of credit cards followed by different banks participating in issuing many other variants.

Growth of Credit Cards in India

In 2017, the total number of credit cards in the n Indian market numbered 2.98 crores as per RBI. And as of the latest data of November 2022. the total number of debit and credit cards has drastically increased. Today India boasts more than 7.7 crore active credit cards with a marking growth of 7.83% shortly.

Credit Cards are becoming mainstream for Indian customers, especially with the millennia. The population now understands and also analyses credit cards, their usage, and the impacts they can create on their lifestyle and financial growth.

What might be the reason behind the sudden jump in the popularity of Credit cards?

• Banks are now much more flexible with issuing credit cards as easy access to credit is present for their customers through CIBIL and other credit bureaus.
• credit cards’ popularity somewhat contributes to the e-commerce boom too.
• Everything going online made it convenient for people to use online platforms to make payments including credit cards.
• Credit Cards also enable people to buy expensive items and repay in installments.
• The growth is also a positive outcome of demonetization.

Also Read: All You Need to Know About Business Credit Card Rewards

Best Credit Cards – The Present Story

Axis Bank Magnus Credit Card

Magnus being a super-premium credit card has more in store than most of the credit cards in the market. From marvelous rewards programs to movies and dining and rewards redemption options, you will get everything at the best rates. There are complimentary lounge access advantages as well with the concierge services and more than that, you get to stay at the Oberoi Hotels at discounted prices. The card comes with a low-interest rate (2.5% pm) and foreign currency markup (2%) and zero cash withdrawal fee. This credit card has it all.

HDFC Bank INFINIA Credit Card Metal Edition

INFINIA is the most premium credit card offered by HDFC Bank with really high standards to match. This card comes with a joining fee of Rs. 12,500 + GST and is very well-suited for travel and dining. The card will help you get value back on all your expenses at the rate of 5 reward points on every Rs. 150 spent on retail. You will also get other perks such as movie and dining, travel, golf, airport lounge access, insurance benefits, etc.

SBI ELITE Credit Card

ELITE is a premium offering by SBI Bank with a joining fee of Rs. 4,999 + GST. This credit card is well-versed in the benefits of movies, travel, and shopping. From great welcome benefits to discounted dining and international lounge access, this card will help you get the best deals in the market. You will also be able to get 2 RPs on every Rs. 100 spent. Although the rewards might not be applicable for fuel spending you will still get the fuel surcharge waiver. You will also be eligible for other added benefits from the bank.

ICICI Bank Sapphiro Credit Card

Sapphiro is a premium credit card by the ICICI Bank which comes with a joining fee of Rs. 6,500 + GST and a renewal fee of Rs. 3,500 + GST. This credit card is versatile and has many branded partners such as Tata CLiQ, EaseMyTrip, Uber, Zomato Pro, and Croma) with which you get the welcome gift voucher. The reward rate is 4 reward points for every Rs. 100 spent on international purchases and 2 on domestic. This credit card has extraordinary benefits to offer while traveling, movies, dining, golf, lounge access, and whatnot.

Conclusion

The Credit Card market has seen many ups and down in the Indian economy. The anti-credit mindsets were dominating society. However, after demonetization and digital marketing kicked in, credit card popularity started booming. All thanks to e-commerce, now India has one of the largest Credit markets around.

While many changes happened over a few decades, credit cards’ position in the market is not just stable but increasing drastically. There are many credit cards present in the market no less than hundreds of the options present for people. From the individual to families and businesses, credit cards are curated taking the needs and wants of society into consideration. With a better understanding and knowledge, people are moving forward and choosing the best credit card for themselves, after all in the end it is all about the credit card best suited for them.