Cashless payments have slowly but surely emerged as the preferred choice for individuals who have been seeking out alternatives to using cash in their transactions. The main reason driving cashless payments till very recently used to be the convenience of carrying a single bit of plastic in your wallet or software in your smart phone instead of a bundle of currency notes. However, the convenience factor took a backseat and was replaced by a necessity to carry out cashless transactions following the ban of 86% of currency notes in circulation.
One of the clear winners of the demonetisation push was the mobile wallet industry with players such as PayTM, Freecharge and MobiKwik, but the bulk of cashless transactions were still carried out using cards i.e. debit cards and credit cards. In terms of penetration, debit cards are much more prevalent in India simply because most banks offer you a debit card with your banking account and ATMs are easy enough to find in an urban area. However, till very recently, a majority of individuals were in fact using their debit card for only withdrawing money from ATMs, which was often used to make purchases. Credit cards on the other hand are more common among the younger generation salaried crowd as most leading private banks that offer salary accounts also offer credit cards to salaried individuals with a range of attractive features. In the following sections we will discuss the key differences between credit and debit cards.