Business
Fuel credit cards led demand surge in 2023 across smaller Indian cities
NEW DELHI: The accessibility and popularity of credit cards in Tier-2 and 3 towns and cities have witnessed a notable surge, a recent consumer study conducted by ZET, India’s leading fintech platform, has found.
The study highlights a significant inclination towards fuel cash-back credit cards, with travel and e-commerce credit cards also experiencing increased adoption rates in 2023.
As fuel expenses continue to escalate, fuel credit cards have emerged as a preferred choice in Tier-2 and Tier-3 cities, experiencing a remarkable 17% year-on-year growth in 2023.
These cards typically offer cashback, rewards points, or discounts on fuel purchases, appealing to a diverse consumer base, especially in smaller cities and towns.
Among the top choices in the fuel cashback category, the BPCL SBI Credit Card, Indian Oil Kotak Credit Card, and IDFC HPCL Credit Card have secured positions as the three most popular options. This surge in credit card usage reflects evolving consumer preferences and the growing importance of cash-back benefits, particularly in India’s burgeoning smaller towns and cities.
In 2023, credit card trends in India’s Tier-2 and Tier-3 towns reflected a notable shift towards travel and e-commerce credit cards.
The increasing accessibility to travel and a growing desire for leisure activities have propelled the demand for travel credit cards, experiencing a remarkable 27% year-on-year growth.
Features like air miles, hotel discounts, and travel-related rewards have found resonance among consumers in smaller towns, with SBI IRCTC, Axis Vistara, and IDFC Vistara emerging as the top choices. Simultaneously, e-commerce credit cards have gained popularity, witnessing a substantial 24% year-on-year rise in 2023. Fueled by increased internet penetration and an improved logistics and delivery ecosystem, these cards, such as Tata Neu HDFC Credit Card, Swiggy HDFC Credit Card, and Axis Flipkart Credit Card, offer exclusive benefits like rewards, cashback, and discounts on online purchases.
These trends underscore the evolving preferences and aspirations of consumers in Tier-2 and Tier-3 cities, emphasizing the importance of tailored credit card offerings.
ZET CEO Manish Shara said there has been a rise in credit card adoption in India, expecting the number of owners to reach 10 crore by early 2024, up from 7.5 crore in April 2022. Shara attributes this growth to factors like increased urbanization, rising incomes, and the government’s push for digital transactions. He applauds Tier-2 and 3 cities for driving this growth and contributing to financial inclusion in newer markets.
The study indicates a 19% year-on-year growth in New-To-Credit (NTC) consumers, with nearly 50% of them being under 25 years of age. Among NTC consumers, the most favored credit cards were AU Small Finance Bank Credit Card, SBI Credit Card, and Axis Bank Credit Card.
The study highlights a significant inclination towards fuel cash-back credit cards, with travel and e-commerce credit cards also experiencing increased adoption rates in 2023.
As fuel expenses continue to escalate, fuel credit cards have emerged as a preferred choice in Tier-2 and Tier-3 cities, experiencing a remarkable 17% year-on-year growth in 2023.
These cards typically offer cashback, rewards points, or discounts on fuel purchases, appealing to a diverse consumer base, especially in smaller cities and towns.
Among the top choices in the fuel cashback category, the BPCL SBI Credit Card, Indian Oil Kotak Credit Card, and IDFC HPCL Credit Card have secured positions as the three most popular options. This surge in credit card usage reflects evolving consumer preferences and the growing importance of cash-back benefits, particularly in India’s burgeoning smaller towns and cities.
In 2023, credit card trends in India’s Tier-2 and Tier-3 towns reflected a notable shift towards travel and e-commerce credit cards.
The increasing accessibility to travel and a growing desire for leisure activities have propelled the demand for travel credit cards, experiencing a remarkable 27% year-on-year growth.
Features like air miles, hotel discounts, and travel-related rewards have found resonance among consumers in smaller towns, with SBI IRCTC, Axis Vistara, and IDFC Vistara emerging as the top choices. Simultaneously, e-commerce credit cards have gained popularity, witnessing a substantial 24% year-on-year rise in 2023. Fueled by increased internet penetration and an improved logistics and delivery ecosystem, these cards, such as Tata Neu HDFC Credit Card, Swiggy HDFC Credit Card, and Axis Flipkart Credit Card, offer exclusive benefits like rewards, cashback, and discounts on online purchases.
These trends underscore the evolving preferences and aspirations of consumers in Tier-2 and Tier-3 cities, emphasizing the importance of tailored credit card offerings.
ZET CEO Manish Shara said there has been a rise in credit card adoption in India, expecting the number of owners to reach 10 crore by early 2024, up from 7.5 crore in April 2022. Shara attributes this growth to factors like increased urbanization, rising incomes, and the government’s push for digital transactions. He applauds Tier-2 and 3 cities for driving this growth and contributing to financial inclusion in newer markets.
The study indicates a 19% year-on-year growth in New-To-Credit (NTC) consumers, with nearly 50% of them being under 25 years of age. Among NTC consumers, the most favored credit cards were AU Small Finance Bank Credit Card, SBI Credit Card, and Axis Bank Credit Card.
