Credit cards surge over 100% in 5 years, debit cards stay steady—Key lessons for card users

The Reserve Bank of India (RBI) has recently stated that credit surge in India has more than doubled in the last five years. The total number of credit cards have reached a staggering 10.80 crore by December 2024, in comparison to 5.53 crore in December 2019 as detailed in a report by Press Trust of India.

Further, debit card numbers have seen a marginal rise from 80.53 crore to 99.09 crore during the same duration. India’s digital payments boom has been clearly highlighted by the payment systems report, with transactions skyrocketing from 222 crore in 2013, valued at ₹772 lakh crore to 20,787 crore transactions worth ₹2,758 crore in 2024. This marks a significant 94-fold increase in volume and a 3.5 fold rise in value.

Not only this, in the last five years alone, digital payments have multiplied 6.7 times in volume and 1.6 times in value signifying a compounded annual growth rate (CAGR) of 45.9% in volume and 10.2% in value.

The report further stated that the Reserve Bank of India has prioritized enhancing cross border payment systems and making the entire process seamless and user friendly. India’s UPI was linked to Singapore’s PayNow in February 2023. This was another step to ensure seamless international remittances. On similar lines integrations have been established in nations like Bhutan, Nepal, France, Mauritius, Sri Lanka and the UAE allowing payments by UPI apps.

Deputy Governor of RBI, T. Rabi Sankar further elaborated on RBI’s commitment to innovation, noting a 100-fold rise in retail digital payments from FY2013 to FY2024. This is a significant achievement for India as the nation continues on its path of being one of the fastest growing major economies.

The Digital Payment Index (DPI) reflects this growth, rising over four times from a base of 100 in March 2018 to 445.50 in March 2024. This kind of rapid growth in credit card disbursements, debit card distribution along with the digital payment infrastructure underlines India’s transformation into a global leader in payment infrastructure and innovation.

What lessons for credit card users make the most of this growth?

It is important for present and aspirational credit card users to clearly understand the terms and conditions of obtaining and using a credit card.

It is not just about obtaining a credit card in a seamless way but what is even more important is for users to understand terms like interest rates, repayment options, credit limits, credit score, repayment flexibility among other associated issues related to credit cards.

Taking educated and informed decisions in this regard are crucial as credit cards carry their own risks and should only be opted for after careful consideration and professional advice.

Note: Using a credit card carries its own set of risks

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