New Delhi: Credit card spending in India reached a milestone in October, crossing Rs 2 lakh crore, marking a 14.5 per cent increase from September, according to the latest data from the Reserve Bank of India (RBI). The figure represented a 13 per cent year-on-year growth, with total spending hitting Rs 2.02 lakh crore.
The number of outstanding credit cards in the country rose to 106.88 million, a 12.85 per cent increase, showing a 0.74 per cent rise compared to September.
HDFC Bank led in new credit card issuances, providing 241,119 cards, followed by SBI Cards with 220,265 and ICICI Bank with 138,541.
While credit card usage saw a significant uptick, debit card transactions dropped nearly 8 per cent from Rs 43,350 crore in August to Rs 39,920 crore in September, according to RBI data. Meanwhile, credit card transactions increased by almost 5 per cent in September, reaching Rs 1.76 lakh crore from Rs 1.68 lakh crore in August.
Market analysts attribute the growth in credit card spending to a low base from the previous year and the boost in consumer activity during the festival season, accompanied by promotional schemes such as equated monthly instalments.
Digital payment methods have seen substantial growth, with their share more than doubling from 14-19 per cent in March 2021 to 40-48 per cent in March 2024, with the Unified Payments Interface (UPI) playing a major role. UPI transactions have seen a compound annual growth rate (CAGR) of 75 per cent, while UPI spends grew at a 68 per cent CAGR between August 2019 and August 2024, contrasting with more modest credit card industry growth.
UPI's dominance is evident in its transaction volume, which stands at 38.4 times that of credit card transactions, as reported by Axis Securities. However, due to the smaller ticket size of UPI transactions, the UPI-to-credit card spending ratio remained stable at 0.3 times as of August.
With IANS inputs