With electronic payments gaining significant momentum in India, the nation’s banks must keep pace and meet the evolving demands of both businesses and end users,
The success of initiatives such as the domestic card payment scheme RuPay and the Unified Payments Interface (UPI) has powered significant digital uptake in India. RuPay has disrupted the debit card space, accounting for an impressive 28% of total debit card transaction value in 2021. Meanwhile, the mobile wallet market has experienced explosive growth, with a compound annual growth rate (CAGR) of 108% between 2018 and 2022.
UPI person-to-person transactions accounted for 49% of all digital transactions in Q2 2022, with debit cards at 5% and credit cards at 3%. UPI clocked in over 17.4 billion transactions in volume and US$370 billion in the same period.
Read more: India’s UPI success showcases strategies for instant payment adoption
The Reserve Bank of India activated the linking of RuPay credit cards with UPI in September 2022. Banks in the country have a chance to get ahead of the competition and provide new digitally-enabled ways of allowing Indians to use their credit card accounts.
Credit cards have a lower penetration rate than debit cards but accounted for over 50% of Indian card payments by value in 2021. This slice of the pie is attributed to attractive incentives, including reward points, discounts, instalment payment facilities, and loans.
Legacy issues
Yet capitalising on this seismic shift can be problematic for institutions still held back by legacy payment technology. Maintaining these systems necessitates substantial technical expertise, resulting in high costs, duplicated efforts, and complex software and hardware requirements.
Additionally, these systems often experience resilience issues, leading to disruptive outages lasting for hours or even days. Just one hour’s outage can stall as many as 400,000 UPI transactions. Major Indian banks HDFC, ICICI, and SBI experienced 85 outages in 2020 alone.
As Indian banks expand their operations, de-risking old systems and establishing stability becomes imperative. Legacy systems have inherent risks, including high costs, vulnerability to outages, talent scarcity, and compliance burden. Banks can mitigate these risks and gain flexibility by transitioning to scalable, cloud-based card processing systems.
Cloud-based solutions like Pismo enable parallel development alongside existing infrastructure, allowing for gradually migrating functions and services. This approach ensures stability during the transition and provides banks with a buffer against evolving market demands.
Pismo offers the solution
Pismo’s cutting-edge cloud-based card issuing system revolutionises the way you manage card transactions. With our platform, you can instantly create virtual cards, providing customisable expiration dates and dynamic CVV codes. Our system seamlessly integrates with your existing templates and ensures a smooth transition and hassle-free implementation.
Whether you require single or dual message authorisations, our production integration caters to all cards, including debit, pre-paid, and credit. Take control of your spending with dynamic controls per merchant category code (MCC), customer, card, and more, empowering you to manage and monitor transactions.
Discover more: To buy or build a new payment system? Which is the best strategy?
Our comprehensive life cycle management features cover all aspects of card usage, from billing and refinancing to revolving credit and debt restructuring. Use real-time events data that builds a comprehensive customer timeline, allowing you to gain valuable insights into your card usage patterns.
Harness the power of extensive data streaming in real-time or through daily files for analytics, regulatory compliance, accounting, fiscal, and treasury requirements. Our system ensures you have the tools.
Want to know more about Pismo’s next-generation payments platform? Download our product briefing today.
