Despite lockdown and restrictions on travel in the financial year 2020-21 or FY21, a higher number of consumers still opted for travel credit cards.
Of the total applications, 25.6% were for travel credit cards last financial year, according to a report from Bankbazaar.com, an online marketplace for financial products. In FY20, it accounted for 17.13% of the total applications.
“Travel cards became a valuable currency in the last one year due to the benefits such as discounts on base fares, priority check-in, free airport lounge access, onboarding privileges, and so on. All these eased woes of people who needed to travel for work or personal reasons in the last year,” stated the report.
As restrictions were easing in the January-March quarter, 41% of all applications were for travel credit cards.
“The first thing that people associate with travel cards are air miles. However, travel cards come with a range of benefits that make travel more comfortable and less expensive,” said Adhil Shetty, CEO. Bankbazaar.com. These include special discounts on select websites, airport lounge access, auto-upgradation, priority pass membership, premier check-in facility, excess baggage allowance benefits, spend linked miles if your spending exceeds a certain specified amount and more. This is in addition to the other features such as joining bonus and dining discounts at partner restaurants.
According to the report, which highlighted trends in credit cards, shopping credit cards were the highest in demand, accounting for 34.6% of overall card applications. As consumers shopped online for essential, food delivery, and entertainment, shopping cards continued to do strongly throughout the year.
The demand for credit cards in non-metros is also on the rise. As entire cities and towns came under lockdown, the dependence on online shopping during the last year was felt strongly across the country, even in the non-metros. “Thanks to regulatory relaxation around KYC norms, it became easier for issuers to service customers in tier 2 and 3 cities. Consequently, the demand for credit cards from the non-metros continued to peak,” said Shetty.
The contribution of the non-metros increased during FY21 to 35% of the overall applications, up from 24.8% in FY20.
(Do you have personal finance queries? Send them to [email protected] and get them answered by industry experts)
Never miss a story! Stay connected and informed with Mint.
our App Now!!