Spends on credit cards in smaller towns has surged: Visa’s Ramakrishnan Gopalan

The world has its eyes on India’s digital payments and the financial services sectors. Scale and volume define the former, innovation underlines progress with the latter. Numbers too, illustrate this trajectory, the kind that’s unseen anywhere else in the world. Global digital payments platform Visa’s white paper ‘Bridging the Gap: Payments in India Beyond Metros’, released earlier this year, indicates that it is not just discretionary spends that have increased across the board, but there are greater spends on credit cards from India’s smaller towns. The white paper data suggests there is an increase of 4 times in the number of credit card users in tier II and tier III towns, who spend more than ₹2,00,000 annually on a credit card.

The reason for this is the growth of digital-first lifestyles, according to Ramakrishnan Gopalan, who is Head for Product at Visa India and South Asia. The primary drivers for this evolution are e-commerce options, increasing usage of digital wallets, and greater awareness emerging from increased global travel. The discretionary spending that’s seen an increase, revolves around lifestyle purchases, online gaming, and dining accounts, he explains. In a conversation with HT, Gopalan talks about how he views India’s contactless payments landscape evolve over the next few years, gaps in an otherwise vibrant ecosystem, securing digital transactions, partnerships with fintechs such as CRED and PhonePe, alongside India’s importance as a research hub for Visa Inc.

Q. How do you view India’s contactless payment landscape at this time, and what are your expectations for the next couple of years?

Ramakrishnan Gopalan: India’s contactless payment landscape is evolving because of greater convenience and security it offers to users. Between 2018 and 2021, cities such as Delhi NCR, Bengaluru, and Hyderabad recorded the highest number of contactless transactions. And this growth is now extending to tier 2 and 3 cities. Visa’s recent report reveals that growing affluence in non-metro India is driving remarkable surge in digital payments, outpacing metros.

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For India’s digital natives who value seamless payment experiences, the choice provided by contactless options through mobile phones, smart watches, among others, is going to define the future of payments. Our data from 2023 reveals 76% consumers believe contactless payments will grow across devices and merchant categories. Additionally, cutting-edge innovation, such as shift towards biometrics for payment authentication and increasing sophistication in AI algorithms for risk identification will also make contactless payments simpler and more secure.

Q. It’s a vibrant ecosystem, with terminals that offer tap to pay, mobile payments and even smartwatches. Do you believe there are still gaps to be filled, such as the lack of Apple Pay in India, perhaps?

RG: India’s digital payments transformation has set a global benchmark, driven by a progressive regulatory framework. As we work towards realising the Viksit Bharat vision, strengthening innovation in contactless payments is key to enhancing several sectors, particularly, the transit and tourism infrastructure. We’ve successfully implemented over 750 contactless transit projects globally, including in London and New York. With vast global experience, we are keen to bring such advancements to transit in India. We also understand that to make contactless payments truly ubiquitous, expanding merchant acceptance and increasing consumer awareness is critical. It is about delivering personalised, interoperable, and multi-modal payment solutions that drive seamless, secure, and inclusive digital transactions across India.

Q. How critical does the transaction security infrastructure become amidst these rising numbers, and how are payment platforms, card networks such as Visa and banks ensuring security through the chain?

RG: We believe security is a cornerstone of digital payments. While digital payments are expanding in India, cyber threats are evolving too. Our foundational tenet is our commitment to securing transactions not only for ourselves but also for our entire partner ecosystem and the users. And, promoting digital and financial literacy that enhances consumer education and awareness remains key. In line with the RBI’s shared objective of keeping users safe, we have been increasingly executing awareness drives such as supporting the ‘Satark Nagrik’ campaign during Cybersecurity Awareness Month (October 2024), Financial Literacy Week (February 24-March 1, 2025) and most recently, Digital Payments Awareness Week (March 10-16, 2025), to educate users about safe payment practices.

We remain ahead of evolving threats with a proactive security-first approach, with investments of $11 billion in technology over the past five years to fortify transaction security and counter emerging fraud risks. Our AI-driven fraud prevention solutions successfully prevented an estimated $40B in fraudulent activities from October 2022 to September 2023. Another step towards building awareness around safe digital payments is our Visa Digital Village Adoption program with MeitY’s Common Services Centre (CSC) Academy. Aligned with the RBI’s “75 Digital Villages” program, our program adopted 1,000 villages across 18 states, to drive financial literacy and payments security training for 50,000 citizens. Half the recipients of this education and awareness drive are women.

Q. How is Visa building on this contactless payments momentum, particularly with a focus on India, with new features?

RG: Contactless payments represent the future of financial transactions in India. With NFC technology, mobile contactless payments are redefining everyday transactions, as seamless, secure, and intuitive payment experiences that align with evolving consumer expectations. As digital-first lifestyles grow, driven by e-commerce, digital wallets, and global travel, discretionary spending on lifestyle purchases, online gaming, and dining accounts for around 63% of emerging affluent consumers spends. Our data also reveals that non-metro card spending has surged 175% since 2019, with cities like Ludhiana and Agra witnessing a rise in millionaires.

To support this growth, we are driving mobile contactless adoption across devices—including phones, smartwatches, wristbands, and IoT-powered solutions—while working with ecosystem partners to integrate seamless, secure, and inclusive digital payments into everyday life. Recognising the need to build merchant acceptance for contactless payments, we partnered with Pine Labs for a soundbox-enabled device Pine Labs Mini, which will transform the way small businesses accept contactless payments through cards and smartphones. With these innovations, we continue to enhance our offerings, helping drive adoption of safe and intuitive contactless payments across consumers and businesses alike.

Q. Does Visa approach building any tech that’s developed for India and then finds relevance in other markets worldwide? What next big tech is in the works in Visa’s labs?

RG: Visa’s Bengaluru centre, our second-largest global tech hub, is home to nearly 4,000 experts driving payments innovation in India and around the world. Many of our global fraud prevention and security solutions have been pioneered here, shaping the future of secure digital payments. In 2021, aligned with RBI guidelines, we led the implementation of Card-on-File Tokenisation. So far, we’ve issued over 430M tokens. We’re also building features such as in-app card payment through device tokenisation with partners such as CRED and PhonePe, offering consumers with mobile wallets unmatched security. Along with our partners we also offer affordable low-cost acceptance devices to facilitate seamless contactless payment options.