Card transactions rise in November, but value drops: report
22 December 2016
Mobile banking transactions in the country rose 10 per cent to Rs124,500 crore in November compared to the previous month even as spending on cards fell on the back of a cash crunch following the 8 November demonitisation, say reports quoting SBI Research.
As per the SBI Research report data, credit and debit card transactions fell to Rs35,240 crore in value terms in November, even as most banks have reported an increase in transactions involving swipe-cards post demonetisation.
There has, however, been a dip in the total value of these transactions.
The use of debit and credit cards at point of sale (PoS) terminals fell to a nine-month low in value terms last month, which is a sharp decline of 31 per cent over that in October, a report in 'The Indian Express' said.
As per the SBI Research report, credit and debit card transactions at PoS fell to Rs35,240 crore in value terms in November, the lowest since February this year when the aggregate spend via PoS terminals was around Rs33,600 crore. The November dip came even as the amount spent at PoS terminals grew constantly from Rs33,230 crore in January to Rs51,116 crore in October this year.
While most banks have reported an increase in the number of transactions involving swipe-cards since demonetisation was announced on 8 November, there has been a sharp decline in the total value of these transactions.
Reflecting a dip in consumption, the use of debit and credit cards at point of sale (PoS) terminals fell to a nine-month low in value terms in November and witnessed a sharp decline of 31 per cent over that in the previous month.
Even till 13 December card spend on PoS remained low and amounted to Rs18,130 crore, says the SBI report.
In line with a decline in aggregate spend at PoS, the average transaction at a PoS also fell from Rs2,229 in October to Rs1,714 in November.
However, the sharp decline is November comes after the festive month of October, when the spend is usually the highest in the three months between October and December.
The SBI report, however, says there is a need to increase the number of PoS from the current level of 1.51 million units 20 around 3.5 million units for digital transactions to gain traction.