India's Prepaid Card Market: Infrastructure, Trending and Market Potential
With 1.2 billion residents and the world’s ninth largest economy, India is the world’s biggest underdeveloped payment market. Despite regulatory pressure and progress in the banking industry, the country’s infrastructure and banking systems remain inadequate and lacking.
While India’s environment creates room for prepaid development, it also makes sustained industry growth challenging. As a result, closed-loop prepaid dominates the market, and semi-open loop issuers have had to be creative in delivering products work within the current environment before the banking industry catches up.
Mercator’s research provides a comprehensive overview of the prepaid card market in India. Both open and closed-loop prepaid card markets are discussed, along with an analysis of 11 major prepaid categories. The report also examines major players in the business ecosystem, as well as strategic issues such as the regulatory environment and industry trends.
“Within the Indian prepaid market, non-traditional prepaid cards play an important role in serving local consumer need,” said Terry Xie, director of Mercator Advisory Group’s international advisory service and principal analyst on the report. “Paper card-based prepaid products became very popular among Indian consumers as they are accepted even at smaller merchants where POS [point-of-sale] terminals are not installed. For prepaid issuers, developing non-traditional card-acceptance solutions is huge because they allow prepaid cards to be widely adopted without traditional POS infrastructure is not there. And the consumer and merchant base can be migrated towards the more traditional mag-stripe card solution when the industry develops. Today, the prepaid card market in India is booming with the co-existence of both non-traditional and traditional card products.”
Highlights of the research findings include:
The report is the third in Mercator’s International Prepaid Market series, following China and the UK.