Press release from Business Wire India
Source: Visa
Thursday, February 23, 2012 05:15 PM IST (11:45 AM GMT)
Editors: General: Consumer interest, Lifestyle, People; Business: Advertising, PR & marketing, Banking & financial services, Business services, Information technology, Major diversified industrial groups; Technology
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Visa Global Payments Tracker: Debit Cards Rapidly Catching up on Cash
Visa survey reveals 68 percent Indians feel secure using a Debit Card
Mumbai, Maharashtra, India, Thursday, February 23, 2012 -- (Business Wire India) -- Banked consumers in India are growing more comfortable with using their debit cards to pay for purchases, according to Visa's latest Global Payment Tracking Survey (GPT 2011) . Debit card penetration in India is at 53 percent, a four percent rise over the previous year, an increase that can be attributed to Indians increasingly feeling more secure while using their debit cards. 68 percent of the respondents from India said that they feel safe and another 51 percent derive a sense of pride when using their debit cards.
Motivations for Debit Card Usage
According to the GPT 2011, the rise in debit card preference in India is likely to be linked to the following benefits that debit cards have over cash:
-- To avoid carrying cash (34 percent)
-- To avoid debt (32 percent)
-- Accepted everywhere (31 percent)
-- To keep cash for later (30 percent)
-- Convenient for everyday purchases (28 percent)
"Indians are motivated by both the convenience of usage as well as the avoidance of debt - key attributes that debit cards possess and which in turn help promote debit card usage," said Brian McGrory, Head of Debit Products in Asia Pacific, Central Europe, Middle East and Africa at Visa Worldwide,
The tracker suggests that even though awareness is high, the rate of usage is still relatively low in India with Indian consumers still using traditional forms of payment like cash because of two main misperceptions in that they will incur an additional fee by merchants on each debit card transaction and the fear of overspending on their debit card.
"The biggest hurdle sometimes can just be a personal mindset or a lack of experience in using their debit cards at a shop. Visa has been partnering with a number of retailers across India to provide incentives for Visa debit cardholders to pull out their cards when they shop. We've seen that cardholders who've used their card at least once at a shop or restaurant realise that not only are there no hidden transaction charges, but they really are using their own money - just in a more modern, secure and convenient way," said McGrory.
The GPT also revealed that on a global level, banked consumers around the world are increasingly relying on debit cards to pay for purchases. On average, 48 percent of all monthly spending (excluding rent and mortgage) is paid on cards - out of which, over 25 percent (an increase of two percentage points since 2010) are debit card payments across the 14 countries covered in the study.
"Visa's Global Payment Tracking Survey provides a critical insight into how different people around the world - separated by geographies, language and cultures - are adopting debit cards as their preferred payment method. While advancement in financial infrastructure may be at different stages in different countries, payment cards, in particular debit cards, are popular because they meet the needs of a fast-paced lifestyle by offering convenience, easy financial management and better security than cash. These are themes that have clearly found significant resonance with billions of consumers around the world," said McGrory.
"In Asia-Pacific, electronic payments systems such as debit cards are rapidly growing in popularity - relative to use of cash or cheques. This creates significant economic advantages, by lowering transaction costs associated with use of cash - such as production, handling and storage costs. Electronic payments also play an important role in helping governments combat money laundering, terrorist financing, tax evasion and fraud. Electronic payments systems such as debit cards are the way of the future for Asia-Pacific governments, companies and individuals, offering scope for significant further gains in efficiency and productivity for payments systems, as well as increasing financial inclusion and access to financial services for large segments of the population in many Asian developing countries," said Rajiv Biswas, Asia-Pacific Chief Economist, IHS Global Insight.
Across the 14 countries surveyed, more than 60 percent of the people polled in the world were cardholders (whether debit or credit card). Specifically, 62 percent own a debit card while 38 percent own a credit card. Visa is also the world's most popular brand of payment card, with an average of 47 percent of debit cardholders holding on to a Visa debit card, and 65 percent of credit cardholders holding on to a Visa credit card.
About Visa
Visa is a global payments technology company that connects consumers, businesses, financial institutions and governments in more than 200 countries and territories to fast, secure and reliable digital currency. Underpinning digital currency is one of the world's most advanced processing networks-VisaNet-that is capable of handling more than 20,000 transaction messages a second, with fraud protection for consumers and guaranteed payment for merchants. Visa is not a bank and does not issue cards, extend credit or set rates and fees for consumers. Visa's innovations, however, enable its financial institution customers to offer consumers more choices: pay now with debit, ahead of time with prepaid or later with credit products. For more information, visit www.corporate.visa.com.
The Global Payment Tracking Survey is an annual survey commissioned by Visa. The 2011 survey had 20,855 respondents aged 18-64, from 14 countries worldwide (US, China, Indonesia, Japan, Peru, Australia, Brazil, Canada, India, Mexico, Russia, South Africa, South Korea and the United Arab Emirates) about their preferred payment habits. The 2011 fieldwork was conducted in March-April 2011.
CONTACT DETAILS
Anuja Sharma, Visa India, +91 9004604426, ansharma@visa.com
Preeti Hoon, Edelman India , + 91 9987037821, Preeti.hoon@edelman.com
Vaishnavi Ramakrishnan, Edelman India, + 91 7738015770, Vaishnavi.ramakrishnan@edelman.com
KEYWORDS
CONSUMER, LIFESTYLE, PEOPLE, MARKETING, BANKING, BUSINESS SERVICES, IT, GROUPS, TECHNOLOGY
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