RuPpay, India’s largest domestic payment network, will rollout its own credit cards by 2016, The Economic Times reports. This is good news for the majority of Indian merchants who still have to wait for their payments to be brought back to them by deliverymen. But it’s bad news for MasterCard and Visa.
“Issuance of the card is expected to give Visa and MasterCard a tough competition, since the debit card issued by RuPay by banks in India has revealed that there is a huge potential for cards penetration and transaction,” NCPI Chairman M Balachandran told reporters, according to The Economic Times.
In 2013, Rupay, speared by the National Payments Corporation of India (NPCI) conquered the realms of India’s eCommerce and reached 160 million RuPay users. Now NPCI wants to reach every Indian by 2020.
Payment cards in general are having a tough time in India which hasn’t quite solved its cash-focused commerce system. According to a Wall Street Journal report, just 1.8 percent of those over the age 15 have access to or have a credit card. Whether it’s because of a lack of banking infrastructure or a population that just has little interest in having credit cards, cash is still king in India. The U.N. Conference on Trade and Development B2C eCommerce index indicates that India ranked 83rd out of 130 countries in the index that ranks countries by Internet users, server infrastructure, credit card penetration and postal delivery.
Still, over the last five years, Rupay’s transactions went from 2 million transactions a day to currently 20 million transactions, Balachandran told The Economic Times.
Meanwhile, in January, MasterCard announced that it added the Gujarat government of India to its list of partners. The following month, it opened its largest Tech Hub outside of the U.S. in Pune, India, built on ElectraCard Services, a Puna-based global provider of software and processing services for electronic payment and card systems that MasterCard acquired in 2014.
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