Owing to the global financial crisis, payments through credit cards declined by 12 percent in the former half of the current fiscal.
A reserve bank bulletin revealed that during the first two quarters the current fiscal, credit card payments stood at Rs. 29,330 crore as against Rs. 33,470 crore in the corresponding fiscal last year.
In September, payments through credit card declined to Rs. 4,902 crore as against 5,635 crore during the corresponding month last year.
Analysts attribute this decline to the worst ever financial crisis and say that people might be averse to taking credit.
Another reason could be that some credit card firms have become wary of payment defaults and have reduced the credit limits on their cards. An economist with a leading bank said that, "Payments made through credit card are down because the maximum amount limit given by banks could have been reduced."
There has been an increase in payments made through debit cards. The debit card payments increased 38 percent to Rs. 11,780 crore in the first six months of this fiscal compared to Rs. 8531 crore during the same period a year ago.