Debit card transactions in India rose 48% with credit cards used less

The Reserve Bank of India reported that debit card transactions increased by 48% in the financial year of 2009 which is against 12.7% increase recorded for credit cards. Furthermore, debit card volumes also rose 44.6% while credit card volume increased by 13.7%.

As supposed by the industry experts the trend towards heavier use of debit cards may be ascribed to the current economic crisis and more cautious attitude of consumers in how they spend their money.

It was also reported that debit card transactions increased 88.6% in March while credit card transactions rose only 34.5%. In value terms, daily transactions through debit cards increased by 73.4% as compared to an increase of 24.8% in credit card transactions.

“This shows the Indian consumer is behaving cautiously. Debit cards bring in the discipline of spending only the money you own. Besides, credit is scarce in a recession and credit card companies are vary of extending credit loosely,” said Piyush Khaitan, Managing Director, Venture Infotek, a transaction management company.