Lenders ET spoke with suggested that they have had a bumper festive season, crossing pre-Covid numbers.
“There has been a continuous growth in credit card spends since the gradual unlocking, leading to a new peak observed in October,” said Sanjeev Moghe, head-cards & payments, Axis Bank. “On a month-on-month basis, spending grew 50% and 75%+ on an annual basis. This is a new peak, with numbers surpassing the pre-Covid levels, primarily led by large scale festive offers covering a wide gamut of categories such as lifestyle, durables, travel & dining.”
Reserve Bank of India (RBI) data showed that overall credit card outstanding remained stable at ₹1.1 lakh crore. September credit card spends surpassed ₹80,000 crore, crossing the monthly peak spends seen in March of ₹72,300 crore.
“Credit card spends have grown 34% sequentially (in September) and trends of October and November first week remain very strong,” said Ansuman Deb of ICICI Securities. “Spending traction is evident from the record absolute spends and the ratio of credit card to debit card spend, which stands at 1.28x. October is likely to be 15-18% better than September while November’s first-week run rate has been better than October.”
RBI estimates showed that the banking system reported net additions of nearly 1.1 million credit cards in September, more than double the additions in July, taking the total credit card outstanding to 65 million. HDFC Bank was the largest acquirer with 244,000 additions, closely followed by ICICI Bank with 234,000 lakh new cards. Axis Bank added over 200,000 cards, while SBI Cards added 175,000 new credit cards.
Kotak Mahindra Bank reported the highest growth in credit card spends at 27% in September over July, followed by ICICI Bank and IndusInd Bank at 13% each.
“We are seeing increased spending on credit cards, led by shopping and travel during the festive season, and expect to see the momentum continue over the next couple of months,” said Ambuj Chandna, president-consumer assets, Kotak Mahindra Bank.
