The market share of RuPay cards is expected to improve soon as banks implement the recent Reserve Bank of India (RBI) directive, offering customers the option to choose card networks among Visa, Mastercard, or RuPay. The move, effective October 2024, aims to promote a domestic card, protect consumers, and accelerate RuPay s acceptance, potentially impacting card issuers earnings due to lower fees and limited international acceptance.
Among the retailers who have initiated or are considering the switch, PhonePe emerges as the preferred choice for 50 percent of respondents, followed by Google Pay at 30 percent, and BharatPe at 10 percent.
“There can be a temporary 3-6-month kind of an impact, which slows down the growth by 3-4% on an annualized basis but still it would compound at more than 30% on an overall revenue growth, which does not disturb our overall thesis wherein we remain positive on the Paytm stock.”
“Our initial assessment at this point in time is, if we were to look at something like a bank or a well diversified NBFC, the overall impact on capital may not be material. We are still reworking the numbers, but initial assessment does seem to suggest that the overall impact on the current capital would not be more than 75, 80 basis points as such.”
“However, it is the borrower s responsibility also to have that list of documents that they have submitted to the bank while taking the loan and to have a copy of that because we have often seen borrowers say they do not have the original paper and also do not know what all documents they had given.”