New Delhi, December 23: The number of debit cards in the country has plunged over 15 percent and touched a two-year-low of 843 million as of October 2019. According to a Times of India report, these numbers were expected to touch the 1 billion mark as 998 million were in circulation till October last year.

However, 155 million cards went out of the market mainly due to the migration of the magnetic strip to chip-based card. The RBI has made it mandatory for all the banks to make this transition as chip-based cards are more secure in terms of the transaction. SBI to Eliminate Debit Cards: How Account Holders Can Use Digital Payment App YONO For Card-Less Transactions.

Banks have also stopped suo motu issuing cards for dormant accounts, the reason being it is not prudent for banks to service these accounts. One, there is a risk of fraud and secondly, it also involves a cost of servicing such accounts. Banks attribute the rise in the dormant accounts to the job-hopping nature of the young salaried professionals. As they switch jobs, they end up leaving their zero-account balance dormant.

The report further mentions that the plunge in the debit cards would have been more severe, had it not been cushioned by rural India, which has seen an increase in the usage of debit cards via Jan Dhan accounts.

(The above story first appeared on LatestLY on Dec 23, 2019 08:40 AM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).