Why your credit card spend is not rising, even though you're using It more

Banks Ramp-up the Credit Card Issuance; However, Spends Fail to Catchup Volume Growth Remains Healthy

If it feels like you are swiping your credit card more often but spending less each time, the data backs you up.

 

According to December 2025 credit card data, transaction volumes continue to rise sharply, even as spending growth slows and average ticket sizes decline. The divergence offers an important insight into how Indians are adjusting their spending behaviour amid higher costs, tighter credit conditions and changing reward structures.  "Average spend per card increased by 7.6% MoM to Rs17,672 in December 2025. However, average spend per transaction remained flat month-on-month and continued its downward trajectory, declining 12% YoY," said Asit C. Mehta Investment Intermediates in a report. 

Average spending per card remains stagnant

 

More Swipes, Smaller Bills

 

In December, total credit card transactions rose 24.2% year-on-year and 7.3% month-on-month to 537 million transactions. In contrast, total spending grew at a far slower 8.8% YoY, reaching ₹2.05 trillion. 

Credit card spending continued to lag, with total spending reaching Rs 2,046 bn in December 2025, a monthly addition of Rs 158 bn.

 

The gap tells a clear story: credit cards are increasingly being used for everyday, lower-value payments, rather than discretionary big-ticket spending.

 

Average spend per transaction declined 12% year-on-year, even as the average spend per card rose modestly to ₹17,672, up 7.6% month-on-month. This suggests consumers are spreading spending across more transactions, not necessarily spending more overall.

 

Cards Are Growing Faster Than Consumption

 

The number of credit cards outstanding continues to rise steadily. In December alone, 0.92 million new cards were added, taking the total cards-in-force to 115.8 million.

 

On a year-on-year basis, card issuance rose 7.2%, with mid-sized banks such as IDFC First Bank and Federal Bank recording much faster growth than large incumbents. Federal Bank’s card base expanded 77% YoY, while IDFC First Bank grew 32% YoY.

 

For users, this expansion means easier access to credit—but also more aggressive marketing of cards, co-branded products and lifestyle-linked offers.

 

Digital Payments Are Dominating Card Usage

 

Online transactions now account for 62% of total card spends, compared with 38% at physical points of sale. This reinforces the shift toward cards being used as a digital payments tool, often replacing UPI or debit cards for convenience, rewards or credit-free periods.

 

But the data also shows that this shift hasn’t translated into higher discretionary spending—suggesting users are prioritising cash-flow flexibility over consumption growth.

 

Banks Are Issuing More Cards, But Tightening Terms

 

While banks are ramping up card issuance, they are simultaneously revising fee structures, rewards and usage conditions. Changes to entertainment benefits, international spends and reward redemption thresholds have become more common.

 

For users, this means the headline reward rate matters less than:

 

where the card is used,

how quickly balances are cleared, and

whether benefits justify annual fees.

 

The data shows that spending growth has not kept pace with card issuance, implying that many users are holding cards defensively, not spending aggressively.

 

"ICICI Bank announced a revision of credit card terms effective 15 Jan, 2026, covering fees, rewards, entertainment benefits and international usage charges across popular cards," said  Asit C. Mehta Investment Interrmediates Limited in its report. 

 

Here are the key highlights: 

• Credit card spending remained subdued, with total spends at ₹2,046 bn, registering 8.4% MoM and 8.8% YoY growth, largely aided by a low base in November 
• Transaction volumes stayed robust, rising 7.3% MoM and 24.2% YoY to 537 million transactions, indicating sustained usage despite slower value growth 
• Card issuance momentum remained strong, with 0.92 million new cards added in December, taking total cards outstanding to 115.8 million, reflecting healthy expansion by banks 
• Average spend per card increased marginally to ₹17,672, up 7.6% MoM, while average spend per transaction declined 12% YoY, highlighting pressure on ticket sizes 
• SBI and Axis Bank emerged as key gainers in spending market share, gaining 152 bps and 45 bps, respectively, driven by stronger sequential growth 
• HDFC Bank retained market leadership with nearly 28% share of total card spending, despite witnessing some market share erosion during the month 
• Among mid-sized banks, IDFC First Bank delivered strong performance, reporting 34% YoY growth in spending and 45% YoY growth in transaction volumes 
• Industry spends for CY2025 stood at ₹23.2 trillion, growing 13.9% YoY, marking a moderation compared to 23% growth in CY2024 
• Top 10 banks continued to dominate, accounting for 93% of total industry spending, underscoring continued concentration in the credit card market