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Credit Cards - Growth Opportunity Should > Regulatory Changes, Competition: ICICI Securities

Credit Cards - Growth Opportunity Should Outweigh Regulatory Changes, Competition: ICICI Securities

A customer makes a  payment with a Visa  credit card at a restaurant in London. (Photographer: Simon Dawson/Bloomberg)
A customer makes a payment with a Visa credit card at a restaurant in London. (Photographer: Simon Dawson/Bloomberg)

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

ICICI Securities Report

The digital payments universe is undergoing significant growth and the need to cut merchant discount rates has often been a point of discussion on increasing the acceptance of credit cards.

The need to maintain business profits to develop the point-of-sale infrastructure and, at the same time, aligning smaller merchants towards digital payments, is a critical balancing act that can be achieved through an optimum MDR.

While a cut in MDR could potentially lead to earnings cut for card companies in the near term, in the Indian context, the under penetration of credit cards embodies a bigger growth opportunity.

As such, credit card companies can invest more in other value-added services centering on innovative lending to generate alternative revenue streams.

Click on the attachment to read the full report:

ICICI Securities Credit Card Sector Update Dec.pdf

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