In today’s digital era, characterized by increasing disposable income and e-commerce transactions, two types of transactions stand out – mobile transactions for low-value spends and credit cards for high-value expenses. Credit cards, providing users with a grace period and installment options, have become the preferred mode of payment.
The Reserve Bank of India’s data reveals a consistent rise in credit card spending every month. Aligning with the trend, Paytm’s co-branded credit cards provide enticing discounts for travel, movie tickets, and various other offerings.
As of September 2023, the number of activated credit cards stands at 8.7 lakh, compared to three lakh a year ago, reflecting a substantial growth of six lakh cards in the past year for Paytm.
Currently, we have partnerships with leading credit card issuers HDFC Bank and SBI Card resulting in upfront distribution revenue and lifetime usage fees. Bhavesh Gupta, the President and Chief Operating Officer shared plans to bring these partners on board for personal loans, merchant loans, and credit cards in the next two quarters.
“I’m happy to inform you that we will add at least two more large NBFCs and one bank. All the three of them are in various forms of UAT, CUG environments. They are not in the agreement stage. So, over the next two quarters, we believe we’ll be able to get them on board both for personal loans and merchant loans and even for credit cards, we will be adding one more bank into our kitty,” said Bhavesh in an analysts call.
Also, we continue to have a very strong relationship with all our seven existing NBFC partners and our existing bank partners for credit card issuance.
Bhavesh says that Paytm’s credibility to be able to offer high quality credit to various lending partners remains robust, leading to more partnerships.
The under-penetrated nature of the credit card industry in India presents significant opportunities for further market expansion. Additionally, the increasing acceptance of RuPay credit cards on UPI is noteworthy as it contributes to the goal of financial inclusion, offering a boost to merchants and businesses in India.
Vijay Shekhar Sharma, Founder and CEO, emphasized the incredible opportunity presented by RuPay credit cards, which are now referred to as UPI credit cards.
“I think RuPay cards offer an incredible opportunity. In fact, in the market, RuPay credit cards are now called UPI credit cards, because people who have RuPay credit cards are linking in large volume to apps like us and they’re making QR led payments. So, there is an incredible opportunity of expanding on rupee credit cards. You’ve seen Paytm has one with SBI and it is actually doing very, very good,” said Vijay Shekhar Sharma in the analysts call on loan distribution business.
