Credit card spends touched an all-time high of Rs 1.16 trillion in July, registering a growth of 6.5 per cent on a month-on-month basis and 54 per cent year-on-year, latest data put out by the Reserve Bank of India revealed.
Spends have topped the Rs 1 trillion level for five consecutive months now.
Industry participants are expecting further tailwinds in credit card spends with the onset of the festive season, where spends typically remain at an elevated level.
Many issuers have lined up special offers on credit cards to boost festival spending and going by recent trends, they expect a promising festive season.
Spends had touched the Rs 1 trillion level for the first time in October last year, buoyed by festive season spending.
A revival in discretionary spending and a pick-up in commercial spends has led to the sustained increase in credit card use.
“Revival in air travel, hospitality sector as well as increasing inflation outlook set a positive backdrop to credit card spend as well as receivables,” said ICICI Securities in a report.
In July, the banking system added 1.53 million credit cards, taking the overall number in the system to over 80 million.
The addition in credit cards was led by HDFC Bank, which added 344,364 credit cards in July, taking its outstanding credit cards to 17.94 million, followed by Axis Bank (227,614 cards).
Axis Bank now has 9.93 million outstanding credit cards.
SBI Card added 218,933 cards during the same time, taking its outstanding base to 14.5 million while ICICI Bank added 194,222 cards, taking its kitty to 13.7 million.
HDFC Bank is the largest credit card issuer in the country, and it has come back strongly in issuing these instruments after an eight month ban by RBI was lifted about a year back.
Kotak Mahindra Bank has also stepped up issuance with over 182,000 in July.
State Bank of Mauritius India, which has tie ups with many new age fintech companies, added a staggering 226,659 cards in July.
HDFC Bank has the highest market share in credit card spends at 28.34 per cent, followed by ICICI Bank (20.1 per cent), and SBI Card (16.7 per cent). Axis Bank has a spends market share of 8.7 per cent as of July.
As far as market share in outstanding credit cards is concerned, HDFC Bank has 22.4 per cent share, followed by SBI Card, ICICI Bank, and Axis Bank at 18.1 per cent, 17.1 per cent, and 12.4 per cent respectively.
