Moody's Analytics has conducted a study of 56 countries for Visa Card usage. The study highlighted that the card usage has been making the economy more efficient by yielding a meaningful boost to economic growth. It also revealed that the growth in the use of electronic payment products (EPP), such as credit and debit cards, adds US$1.5 billion to the Gross Domestic Product (GDP) of India.
Globally, electronic payments contributed $983 billion to the GDP of the 56 countries examined between 2008 and 2012. From 2008 to 2012, global real GDP was only 1.8 per cent per annum. Without increased card usage, that growth would have been 1.6 per cent. Electronic payments lead to a reduction in the gray economy by increasing transparency and generating additional tax revenue.
Uttam Nayak, Visa Group Country Manager, India and South Asia, said, “With growing card usage contributing US$1.5 billion to India’s GDP, there is no denying the benefits of electronic payments here, nor the importance of maintaining an open marketplace to encourage competition and innovation within the industry. We can see from the data that the positive impact on economic growth is the direct result of card usage and is tied to the benefits electronic payments offer, including enhanced security, convenience of operating without cash or checks, increased efficiency at checkout and a reduction in the grey economy.”
“Despite a challenging global economic landscape, the increasing penetration of payment cards helped increase consumer consumption and, on average, added to GDP,” said Mark Zandi, Chief Economist, Moody’s Analytics.
