India’s shift to digital payments has had a major impact on the credit card market. In the past few years, the number of credit cards in circulation has grown by leaps and bounds, and the country is now on track to cross the 10 crore mark by the end of this year.
This growth is being driven by a number of factors, including the increasing popularity of online shopping, the rising affluence of Indian consumers, and the growing acceptance of credit cards at merchants across the country.
Of course, the credit card market is not without its challenges. The market is dominated by a few large players, and there is a risk of overspending among consumers. However, overall, the outlook for the Indian credit card market is very positive.
Key Trends In The India’s Credit Card Market
- The number of credit cards in circulation is expected to grow by 20% in 2023.
- The average spend on credit cards is expected to reach new highs.
- The market is becoming more competitive, with new players entering the fray.
- There is a growing focus on digital payments, with more and more consumers using their credit cards online.
HDFC Bank Continues to Lead the Credit Card Market in India
The Indian credit card market is booming, with the number of cards in circulation growing by 15% in the past year to 8.6 crore. This growth is being driven by a number of factors, including the increasing popularity of online shopping, the rising affluence of Indian consumers, and the growing acceptance of credit cards at merchants across the country.
Despite this growth, the market is still dominated by a few large players. HDFC Bank is the clear leader, with over 1.78 crore outstanding cards, followed by SBI with over 1.68 crore cards and ICICI Bank with 1.45 crore cards. Axis Bank is in fourth place with 1.22 crore cards.
HDFC Bank’s dominance is due to several factors, including its strong brand name, its wide network of branches and ATMs, and its innovative product offerings. The bank also offers some of the most attractive rewards programs in the market, which has helped to attract a large number of customers.
In terms of average transaction size, HDFC Bank also leads the pack, with its customers spending an average of Rs 5961 per card. SBI comes in second place with Rs 5275, followed by ICICI Bank with Rs 4545 and Axis Bank with Rs 3643.
The continued growth of the Indian credit card market is good news for consumers, as it gives them more choice and flexibility when it comes to paying for their purchases. It also means that banks are competing to offer the best rewards programs and other benefits, which is ultimately good for consumers.
Average Monthly Credit Card Spend Soars
The average monthly spend per credit card in India has soared by 9.37% in April 2023, compared to the same period last year. This is a clear sign that consumers are increasingly using their credit cards to make purchases.
The average transaction size for credit cards in April 2023 was Rs 5,120, while the average monthly spend per card was Rs 15,388. This means that consumers are using their credit cards to make larger purchases, and they are also using them more frequently.
Several factors could be driving this increase in credit card spending. One possibility is that consumers are taking advantage of the growing number of rewards programs offered by credit card companies. Another possibility is that consumers are using their credit cards to make online purchases, which are often more expensive than offline purchases.
Whatever the reason, the increase in credit card spending is a positive sign for the Indian economy. It shows that consumers are confident in the economy and they are willing to spend money. This is likely to boost economic growth in the coming months.
Who are the top spenders?
Citibank and Karur Vysya Bank are the top spenders in the credit card market. Citibank cardholders averaged Rs 10,798 per transaction, while Karur Vysya Bank cardholders averaged Rs 29,141 per month.
Which banks have the most frequently used cards?
South Indian Bank, CSB Bank and Federal Bank have the most frequently used cards. On average, these banks’ cardholders made 4 transactions per month per card.
Which banks have the highest online spends?
Citibank, American Express and IndusInd Bank have the highest online spends. Over 70% of all their transactions were made online. The average online transaction for these banks was Rs 6,851.
The future of credit card spending
The future of credit card spending looks bright. With the growing popularity of online shopping and the increasing number of rewards programs offered by credit card companies, it is likely that credit card spending will continue to grow in the coming years.
Spike In Credit Card Debt
The use of credit cards has been on the rise in India, as consumers increasingly use them to make big-ticket purchases. This is being driven by a number of factors, including the increasing availability of rewards programs, the growing popularity of online shopping, and the rising affluence of Indian consumers.
The average monthly spend per credit card in April 2023 was Rs 15,388, up from Rs 14, 070 from the corresponding period last year. This is a significant increase, and it suggests that consumers are using their credit cards to make larger purchases.
The outstanding debt on credit cards also grew by 30 per cent from Rs 1.54 lakh crore to Rs 2 lakh crore this year. This is a worrying trend, as it suggests that consumers are not paying off their credit card debt in a timely manner.
There are a number of risks associated with high levels of credit card debt. For example, consumers may be forced to pay high interest rates on their debt, and they may be more likely to default on their payments. This can have a negative impact on their credit score, making it more difficult to obtain loans in the future.
UPI payments eat into Debit Card transactions
The popularity of UPI payments is continuing to grow in India, as consumers increasingly use it for small, everyday transactions. In April 2023, UPI transactions amounted to Rs 14 lakh crore, up from Rs 9.8 lakh crore in April 2022. The number of UPI transactions also increased to 886 crore, from 558 crore in the previous year.
The rise in UPI payments has come at the expense of debit card use. In April 2023, debit card transactions fell to 4.6 crore, from 5.2 crore in the previous year. This is likely due to the convenience and ease of use of UPI payments. UPI payments can be made using a smartphone, and they do not require a physical card or PIN.
The growth of UPI payments is a positive sign for the Indian economy. It shows that consumers are increasingly using digital payments, which is helping to boost financial inclusion. UPI payments are also more secure than cash or checks, and they can help to reduce fraud.
Here are some of the reasons why UPI payments are becoming more popular:
- They are convenient and easy to use.
- They are secure.
- They are free for most transactions.
- They can be used anywhere that accepts UPI.
The future of UPI payments
The future of UPI payments looks bright. With the continued growth of digital payments in India, UPI will likely become even more popular in the coming years. UPI payments are a convenient, secure, and affordable way to make payments, and they are likely to continue to gain traction in the Indian market.
Credit Card Market In India FAQs
What are the top 5 banks that issue credit card in India?
Credit Card by Banks
- The ICICI Bank.
- The Axis Bank.
- The RBL Bank.
- The HDFC Bank.
- The SBI Card.
What are the 4 biggest credit cards?
American Express, Discover, Mastercard, and Visa are the four major credit card networks.
Which bank has most credit card users in India?
The HDFC Bank
HDFC Bank is not just one of India’s largest private banks, but it also has a significant market share in terms of credit card services. As of September 2022, HDFC Bank had around 1.70 crore active credit cards, making it the largest card issuer in the country.
Which bank has the most credit card users?
Chase Credit Card Issuers with the Highest Number of Cardholders
The number of active accounts is one technique to determine the major credit card businesses. Chase had the most total cardholders in 2021, with 149.3 million. This is a 43.1% increase over the company’s total in 2020.
Which are India’s top three credit cards?
Best Credit Cards In India
- Featured Partners.
- Axis Bank ACE Credit Card.
- Dhanlaxmi Bank Platinum Credit Card.
- SimplyCLICK SBI Credit Card.
- HDFC Millennia Credit Card.
- Best Credit Cards In India.
- LIT Credit Card (AU Small Finance Bank)
- Flipkart Credit Card from Axis Bank.