Credit card spending in India rises to Rs 1.78 trn in Oct, sets record

Credit card spending by Indians rose 25.35 per cent to a new high of Rs 1.78 trillion in October from Rs 1.42 trillion in September 2023, supported by growth in point of sale (POS) transactions and e-commerce payments in the festive season.

PoS transactions increased to Rs 57,774.35 crore and e-commerce payments to Rs 120,794.40 crore in October.

Transactions of HDFC Bank credit cards, the industry leader, increased to Rs 451,73.23 crore from Rs 38,661.86 crore in September.

ICICI Bank card transactions increased to Rs 34,158 crore and Axis Bank rose to Rs 21,728.93 crore.

Transactions in SBI Cards, issued by the public sector lender, grew to Rs 35,406.01 crore from Rs 24,966.69 crore in September.

Cards issued by domestic lenders increased by 1.69 million in October to 94.71 million from 93.02 million in September.

HDFC Bank maintained its leadership position, having 19.18 million cards in October compared to 18.83 million in the previous month.

SBI Cards stood at 18.07 million, ICICI Bank at 16.01 million, and Axis Bank at 13.30 million.

The credit card industry is likely to see loan growth moderating after the Reserve Bank of India (RBI) last week asked commercial banks and non-banking financial companies to increase the risk weight for unsecured lending.

“Higher credit card transactions in October were largely due to the commencement of the festive season and stronger activity on the consumer side,” said Ankit Jain, senior analyst at India Ratings & Research.

“There is some moderation expected in loan growth for the credit card industry, largely on the back of concerns raised by the regulator in certain pockets of unsecured lending products,” said Jain.