What’s hot, and what’s not – On the Net

Hi. Between 2001 and 2006, the internet base of active users has grown from 3.1 m to 13.2 m. That’s a 425% growth in 6 years ! Remarkable.

During the same time the most popular of all Internet applications – Email declined in usage from 64% to 45%. The new emerging winners are information search ( 20% to 33%) and e-commerce. E-com has grown from 1% to 4% – modest no doubt but the growth has come in two years, between 2004 and 2006.

We are also seeing that demographic segments are developing specific application focus. So whilst online gaming will become a key driver for children quite like other S.E. Asian countries, e-commerce is emerging as a new area for young men, with ticketing becoming a killer app.

It’s a no brainer that higher credit card penetration and useage, coupled with greater comfort with using the card online will drive higher ticket size transactions on the Net.

So what is the credit card usage trend in India? I am attaching below a recent February ’07 article from the ET:

”  The Indian credit card market is growing at a brisk pace. According to RBI’s latest monthly report, nearly 20% of the total retail electronic payments is being carried out through credit cards. By contrast, payment through debit cards, another plastic product, is just 4% of the total retail electronic transactions.

Credit-card penetration is highest in Mumbai and Delhi. The likes of Bangalore and Hyderabad too are fast catching up. Kolkata, with its expanding IT/ITeS flock, has also thrown up big business prospects for credit card issuers. No surprises that with increased commercial activity and the proliferation of glitzy malls, the credit card market holds significant promise for credit card issuers these days.”

I believe that faster credit card adoption ( read usage, and not just having one) will be the muscular supplements the fledgling e-commerce industry in India needs to become a serious player and move from the sidelines to centrestage. Cheers!


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