Segmenting Customer Base

The Credit Card market is generally segmented based on four parameters:

1. Customer life cycle

A suggested approach for the segmentation can be the following:

► Urban Customer /Rural customers

► High exposure / low exposure to Financial services

► High net worth/Affluent/Mass affluent customers

The members can target their preferred segment of customers after categorizing into
different buckets. An informed and well thought out approach should be taken by the issuer
to target the segment with the appropriate RuPay product offering.

Product Positioning
The objective of the RuPay Credit Card Program is to provide value added benefits in a cost-
effective way.

RuPay Credit Card will come with in-built features such as:

► Insurance Cover

► Lounge Access Program- Domestic and International

► Domestic and International Concierge Services

► Fuel Surcharge Waiver

► Cash Back on payment of Utility Bill Payment

► Discount offers on selected merchant Categories

Issuers can build their value proposition along these points to build a distinctive product
positioning in the minds of the cardholder.
Target Positioning
The target audience of RuPay is mostly the retail consumers or the consumers who prefer to go
cashless under the ongoing movement of Cashless India, with a special emphasis to the rural areas
as the cost of transactions is lower than the foreign competitors, i.e. Visa and MasterCard, who
provide services at a higher cost due to international gateways. RuPay has its own gateway to clear
transactions which makes it a convenient and a cheaper mode of payment. Kisan Card by RuPay has
also provided the farmers the opportunity to conduct business transactions at ATMs and Point-of-
Sale (PoS) terminals across the nation.

Since every transaction through RuPay will take place within India, the banks will
have to pay lesser service charge to the payment gateway as compared to Visa,
MasterCard and others. Hence the processing fee is lower. While Visa and
MasterCard charge about INR 3 for every e-commerce and point of sale
transactions, RuPay charges 90 paisa only.

Since processing would be done within India the transactions would be faster as
compared to other cards. RuPay does not require banks to pay joining fees or
quarterly fees unlike international payment cards such as Visa and MasterCard.
RuPay card is offered by large public and private sector banks and small rural and
co-operative banks (with a network of 200-250 member banks) whereas international
cards lack such a coverage. RuPay has gained more than 1/3rd market share in total
cards outstanding and 18% share in terms of volume of debit card transactions.
Within a short span of time, it has gained over 20% market share in debit card-based
ATM transactions and 4% share in debit-card based PoS transactions. 

 Security
Yes, RuPay cards are totally secure as they come with enhanced security of 256-bit
encryption and require an OTP which is sent on your registered mobile number for
each and every transaction that you make.

Also, since these are domestic cards, the data is secure within the boundaries of the
country and is not shared outside the country unlike Visa and MasterCard
transactions.
7P’s Marketing mix of Rupay

Product

 Debit card

 Credit card

 Rupay combo (Debit cum credit card)

 Rupay prepaid

 Rupay contactless

 Rupay global

 BharatQR

RuPay is India’s very own card scheme to promote debit and credit card
transactions, which was launched in 2012, by National Payment Corporation of
India (NPCI). Even though 90% of debit card transactions are domestic in nature,
the cost of transactions is high due to the use of foreign counterparts like Visa and
MasterCard.

As a product extension, RuPay also has a Kisan Credit Card, PunGrain card (a
Punjab government initiative), Mudra card, PMJDY card etc to cater to the
different needs of the Indian demographic. If the transaction is done in India using
RuPay, does not go out of the country either. RuPay fulfils the RBI and the
government’s vision for a ‘less-cash’ economy, as an after-effect of
demonetization. RuPay credit cards and debit cards have various categories under
them, like RuPay Select, Rupay Platinum and RuPay Classic. RuPay Contactless is
another initiative which offers a unique proposition of One Card for all payments.
This card can be used for transit payments are buses, metros etc, toll, parking and
day to day retail payments as well.

To reach out to various segments, Rupay also offers prepaid gift cards, student
cards, payroll cards etc. Hence, RuPay has an offering for each and every
individual, no matter what they need to be.Another benefit of RuPay is that since
the transactions are done at a national level, the speed is higher than the ones done
using international cards. In only a matter of 6 years, RuPay has given strong
competition to the dominance of MasterCard and Visa. One of the drivers of its
growth was demonetization and the other was that in all of the accounts opened
under the PM Jan Dhan Yojana, RuPay cards were provided to the account-
holders.

From just 0.6% market share in 2013 to almost 35% in FY 16 and now RuPay
currently has more than 50% share in the India’s debit card market by volume,
surpassing the age-old leaders, MasterCard and Visa. Riding on the back of the
nationalist movement and to the increasing preference of using indigenous
platforms, Rupay has been a success due to its features, innovations and inclusive
options. . RuPay cards are accepted at 97% of all PoS terminals in India. RuPay
has partnered with 39 PoS-acquiring banks in India to accept their cards at PoS
terminals located at different merchant locations.

Price

One of the biggest reasons why RuPay captured a big chunk of the market was its
flat fee.RuPay charges transaction processing fees that are approximately 23%
lower than those charged by Visa and Mastercard.every RuPay-based transaction,
NPCI charges 60 paise for acquiring and 30 paise for issuing. So,if a person using
a RuPay card by Bank X pays through Bank Y’s PoS terminal, as the acquirer
Bank Y will pay 60 paise to the NCPI and Bank X, the issuer, will pay 30 paise.
This, when compared to Visa and MasterCard’s merchant-discoun rate, is
minuscule, as it is calculated as a percentage of the actual transaction amount.
Hence the benefits extend to both customers and banks, in the form of low
transaction fee and no network entry fee respectively.

Place

Over 1100 banks in India issue RuPay cards to its accountholders. It is issued by
Private and public sector banks of India, cooperative banks and regional rural
banks. Under RuPay, there are more than 26 lacs PoS terminals. RuPay cards have
also established its market on major online gateways.

RuPay has also partnered with more than 35 banks, RuPay has collaborated with
almost 600 international, regional and local banks across the country. It’s ten core
promoter banks are State Bank of India, Punjab National Bank, Canara Bank, Bank
of Baroda, Union Bank of India, Bank of India, ICICI Bank, HDFC Bank, Citibank
N. A. and HSBC. It expanded its shareholding in 2016 to 56 banks to bring more
banks across sectors under its umbrella. So as to accept their cards at different
merchant locations at PoS. The adoption of RuPay is increasing significantly, with
PayTM Payments Banks issuing only RuPay cards.To increase its international
reach, Rupay has partnered with Discover Financial Services, Diners Club
International, and UnionPay International etc. Other than India, RuPay has services
in Singapore and Bhutan as well.
Promotion
The promotion has a huge role to play in Rupay’s success in a short span of time. It
is endorsed by the Government of India and PM Narendra Modi at platforms like
Make in India Conference and the Delhi Economics Conference.
Rupay’s promotion is based on discounts and offers with popular e-commerce sites
and retail stores like Big Bazaar, BookMyShow, RedBus, Make My Trip, Big
Basket, and many such portals.
Government and co-operative societies has initiated various programmes to
promote and take up social initiaves :
 Pradhan Mantri Jan Dhan Yojana (PMJDY):- Close to a 100 million RuPay
cards were issued under this scheme.
  IRCTC RuPay Prepaid Cards – IRCTC (Indian Railway Catering and
Tourism Corporation) in collaboration with the Union Bank of India
launched the IRCTC RuPay Prepaid Card, that allows passengers to easily
book train tickets in India. 
 RuPay Mudra Card – Mudra (Micro Units Development and Refinance
Agency Ltd) Bank launched the Pradhan Mantri Mudra Loan Yojana to
provide advanced methods of funding to small scale industries in India.
 Cash@POS- is another innovative program by RuPay that allows RuPay
card holders to withdraw up to a certain fixed amount from merchant POS
terminals, just as cash or along with other purchase of good or services.
Services like these can prove to be very significant in places with low ATM
density. Even regional rural banks (RRBs) and cooperative banks are issuing
RuPay cards in tier 2 and tier 3 cities, thereby improving the footprint in
remote corners of the countries.

They have promotional offers both on online sites and offline retail outlets to reach
out to all types of customers. This has led to strong adaption from the Indian
masses that are going digital.
Rupay has also extended its promotional offers to dining, travel, spas etc. Another
promotional method used is cash backs for transactions made using Rupay. Social
media is also used for promotion by RuPay. It has an active presence on all social
media platforms like Facebook, Twitter, Instagram etc, where it informs and
reposts about all the latest offers and partnerships.

Twitter digital promotions :

(Source : Rupay Twitter, NPCI media reports )

People
RuPay cards are credit and debit cards that are used by most of the people in Rural
India and also tap in Urban India. The main reason why it holds a major share in
the Indian Market and gives a tough completion to the already established Visa and
MasterCard is that being made in India by the government itself it caters to the
needs of people in India. Another way how it moulds with its consumers is by
providing Kisan Cards or Kisan Credit Cards where farmers get paid and can rake
some amount of credit for their farming purposes.
The Kotak Mahindra Bank in partnership with RuPay Cards provides the dairy
farmers of Amul with their payment. Many cooperative societies and the people in
it are directly connected to the Rupay Card for their payments. It also serves as a
prepaid card for IRCTC, the Indian Railway which is the major source of
transportation for people. It majorly runs because it furnishes the needs of the
people it serves.
Physical Evidence
With more than 65% of market share, Rupay is now cashless India’s largest card
network. It can be extensively used throughout the nation in almost all PoS
terminals, ATMs and now ecommerce portals too as all of them have recognised
the RuPay cards. All major, rural and cooperative banks issue RuPay cards, which
is backed by 11 leading banks. 515 million cards were issued as of August 2018,
which took over 50% of market share of the nation’s debit card users, thrashing the
old players and the well established players, Visa and MasterCard. Around 560
million transactions, more than half of the transaction in India is done using Rupay.
It has been launched Singapore linking to its 33-year-old network for electronic
transfer. It has also been accepted in Bhutan. For its increase in Global presence, it
has an agreement with international payment networks like Discover, Diner Club,
JCB, UnionPay etc.

Process
RuPay Contactless offers the unique proposition of One Card for all Payments.
This card can be used for transit payments (Bus, Metro, Cab etc.), toll, parking,
small value offline retail payments as well as normal day to day retail payments.