BENGALURU: With banks offering reward points, discounts, deals and other add-on services on co-branded cards, credit cards have become the preferred mode of payment this festive season.
In terms of total expenditure, credit card users have spent about five times more than debit card users in 2022.
According to PayU’s Insights Report- Festive edition, on average, a credit card user has spent Rs 6,000 compared to a debit card user who spent Rs 2,500, in 2022. Also, credit card transactions and expenditures grew 42% and 84% YoY, respectively.
The report also said that credit repayment such as personal loans for consumers and businesses witnessed a 107% increase in expenditure and 105% increase in transactions over the last festive season. “One of the highest categories for UPI spending was Credit Repayment, showing that Indians are increasingly repaying personal loans using UPI. Not surprisingly, debit card transactions declined by 34%,” PayU said.
UPI is becoming the preferred choice of digital payments. With increased UPI adoption by small businesses and consumers, there was a 133% rise in the number of transactions and a 124% growth in expenditure in 2022 compared to 2021.
The average ticket size for UPI transactions has gone down marginally -4%. PayU says that consumers used UPI for small ticket items such as groceries, within city travel and entertainment, and that could be the reason for reduced ticket size.
Mumbai, Bengaluru, Hyderabad, Chennai and Delhi NCR are the top 5 cities that contribute to the highest number of transactions through UPI. The report also said that there has been a 245% increase in expenditure and 130% increase in the number of transactions between the normal period of 2019 and post-pandemic period of 2022.
133% rise in UPI transactions
With increased UPI adoption by small businesses and consumers, there was a 133% rise in the number of transactions and a 124% growth in expenditure in 2022 compared to 2021.