Credit card spends touch all-time high of Rs 1.37 trillion in March

For FY23, spending topped Rs 14 trillion, up 47.27% from Rs 9.71 trillion in FY22

Credit card spends touched an all-time high of Rs 1.37 trillion in March 2023, driven by discretionary spends, the latest Reserve Bank of India (RBI) data showed. It’s for the 13th consecutive month that credit card spends have topped the Rs 1-trillion mark, reflecting the increase in consumer spending since the easing of the Covid pandemic.

For 2022-23, credit card spending topped Rs 14 trillion, up 47.27 per cent from Rs 9.71 trillion in FY22. 

The banking industry added about 1.93 million credit cards in March, taking the outstanding credit card base to 85.3 million cards. The net credit card additions in March were a bit higher than 1.2–1.5 million cards that were being added every month last financial year. 

In FY23, around net 11.67 million cards were added -- a marginal rise from the 11.15 million additions in FY22.

According to the latest data, almost 63 per cent of credit card spending, or a little over Rs 86,000 crore took place via e-commerce, while the rest was through point of sale (PoS) terminals. Spends in March recorded a 28 per cent jump year-on-year (YoY) and a 15 per cent increase month-on-month (MoM).

The March figure topped the previous record of Rs 1.29 trillion, set in October 2022 amid the festival season. 

Among large players, Axis Bank recorded a 54 per cent jump in spends over February, followed by ICICI Bank, which recorded over 20 per cent growth. HDFC Bank’s spends increased by 14 per cent and SBI Card saw an increase of 11 per cent during this period. 

The net addition in credit cards was led by Axis Bank (2.34 million) as Citibank’s credit card portfolio was subsumed by the bank. Axis Bank’s card base expanded to 12.1 million as of March 31.

Among other major issuers, ICICI Bank added 720,239 cards, taking its outstanding cards in force to 14.4 million cards. SBI Card added 256,463 cards and its card base now stands at 16.76 million.

The country’s largest credit card issuer -- HDFC Bank -- added 236,770 cards in March, taking its card base to 17.53 million at the end of March 2023.

While spends have seen an exponential rise in the past year, the rise in the net addition of cards has not been commensurate with the rise in spending. This could be because of the RBI guidelines that mandated card issuers to deactivate credit cards inactive for a year. This led to a huge correction in the industry, which brought down the outstanding base of credit cards substantially.

As far as market share is concerned, HDFC Bank has the biggest market share -- both in terms of cards in force (CIF) and spends. As of March 2023, HDFC Bank has a spends market share of 27.41 per cent and a CIF market share of 20.55 per cent, followed by SBI Card with 17.93 per cent and 19.65 per cent market share in spends and CIF, respectively. The third in the pecking order is ICICI Bank with 17.45 per cent and 16.94 per cent market share in spends and CIF respectively, followed by Axis Bank with 11.97 per cent market share in spends and 14.21 per cent market share in CIF.