India’s domestic card network, RuPay, operated by the National Payments Corporation of India (NPCI), has made significant in-roads into the credit-card market.
Recent reports show that RuPay’s share of credit-card spending in India has climbed to about 16 % of total credit card spends.
In terms of credit-card issuance and transaction volume, several sources report that its share went from approximately 3 % in 2023 to around 12 % by 2024.
This is a notable shift for RuPay, which for years was dominant in debit-cards but relatively minor in credit-cards.
Why this growth matters: The broader implications
1. Domestic card ecosystem gains strength
RuPay’s growing market share underscores India’s push for a more self-reliant payments infrastructure, reducing reliance on global card networks (e.g., Visa, Mastercard). With about 16 % of credit‐card spend on RuPay, the domestic network is no longer peripheral
2. Leverage of UPI-linkage
A major driver is the integration of RuPay credit cards with the country’s digital payments platform Unified Payments Interface (UPI). Because RuPay credit cards can link to UPI, it boosts convenience and lowers friction — especially at smaller merchants.
3. Digitisation & financial inclusion
As credit-card usage expands beyond metro areas and large stores into smaller merchants and via UPI, RuPay is positioned to capture segments previously underserved by premium global-card networks. The influx of younger users, virtual cards, and lower transaction sizes are part of that trend.
4. Competitive pressure on global networks
With RuPay’s share expanding, global networks may face structural challenges in India. Their cost/presence trade-offs differ when a large domestic network is scaling fast and has regulatory/structural advantages.
How RuPay got here: Key strategies and enablers
- Regulatory enabler: In June 2022, RBI allowed credit‐cards on RuPay to be linked to UPI — unlocking a major channel.
- Merchant & fee-economics: RuPay’s lower network cost and favourable merchant-discount-rate (MDR) structures compared to global counterparts give it an edge, particularly for smaller merchants.
- Bank and fintech partnerships: NPCI has stepped up incentives for banks and fintechs to issue RuPay credit cards, accelerating adoption.
- Focus on volume & digital usage: UPI-enabled credit cards (which are mostly RuPay) have high transaction frequency (40+ transactions/month) though lower average transaction size, helping build scale.
The numbers: Where exactly is RuPay now?
- RuPay’s share of credit-card spends: ~16 % of all credit-card spend in India.
- RuPay’s share of credit-card transactions/volume: around 12 % by some reports in 2024.
- Earlier: ~10 % in FY24.
- Still room to grow: Many estimates suggest it hasn’t yet reached 18 % market share as a stable figure.
What to watch: Challenges & next-steps
- Global acceptance: While RuPay is strong domestically, its international acceptance lags global players — this may limit its appeal for some premium users/travel. Moneycontrol
- Transaction value gap: Average transaction sizes for RuPay credit cards (via UPI) are lower compared to traditional premium card networks (₹1,125 vs ~₹4,000).
- Merchandise ecosystem: While UPI coverage is massive, card acceptance in some contexts remains uneven — ensuring RuPay’s card network is as seamless as global rivals is crucial.
- Sustaining growth beyond early adopters: Capturing higher‐spend segments, cross‐border usage, premium customer segments will determine how far RuPay can go.
- Competitive reaction: Global networks may ramp up local partnerships, cost strategies or regulatory lobbying — RuPay must stay ahead.
Outlook: What could happen next?
If RuPay continues its current trajectory:
- It could push its market share toward ~18% or more of credit card spends in the near future.
- Growth may hinge on deeper adoption at smaller merchants, new credit‐card issuance (especially virtual cards) and further UPI usage.
- For banks and fintechs: Issuing RuPay credit cards may become a standard strategic lever rather than niche.
- For consumers: Expect more co-branded RuPay credit cards, incentives, and seamless UPI linkages — meaning lower cost, higher convenience.
- For global networks: They may have to innovate aggressively (lower fees, better value, UPI-linkage) to retain competitive edge in India.
Conclusion
The rise of RuPay in India’s credit-card market is a compelling story of structural change: a domestic network leveraging regulatory change (UPI linkage), cost advantages, distribution scale and fintech partnerships to move from the sidelines into a significant market position. While it hasn’t yet achieved 18 % as a widely verified figure, its current share (~16 %) already marks a meaningful shift.
