Card Transactions Shoot Up Post-Demonetisation

Post-demonetisation, the card-based transactions have risen up to 90 per cent of total sales in third quarter of 2016-17, according to India Ratings and Research (Ind- Ra).

"Contrary to the popular belief, organised fashion retailers (departmental stores) have bucked the impact of demonetisation. most of these departmental stores are located in Metros and Tier I and II cities where consumers were readily shifting to card payments; resulting in the share of cards as a percentage of revenue increasing to 80-90 per cent in the last quarter," the rating agency said.

Ind-Ra said it expects organised retailers in the food, grocery and fashion retail segments to be unaffected, high value items namely jewellery, luxury items (watches), consumer durables to show contraction in topline in third quarter of 2016-17.

Contrary to the popular belief, organised fashion retailers (departmental stores) have bucked the impact of demonetisation. most of these departmental stores are located in Metros and Tier I and II cities where consumers were readily shifting to card payments

Observing that the organised retail jewellers are likely to report minimal growth to de-growth year-on-year in third quarter revenues as consumer demand remained muted in the aftermath of demonetisation, Ind-Ra said margins are also likely to be impacted given the high operational leverage in the segment; albeit supported by higher gold prices for most part of the demonetisation period.