Credit card spends fell 3.3% on a month-on-month (m-o-m) basis to Rs 1.33 trillion during April, data released by Reserve Bank of India (RBI) showed. On a year-on-year basis (y-o-y), however, aggregate credit card spends increased nearly 26%.
During the month of March, overall credit card spending had touched a record high of Rs 1.37 trillion and for FY23, it rose 47% y-o-y to `14 trillion, driven by a rise in e-commerce and point-of-sale transactions.
Nearly all banks, except HDFC Bank, reported a fall in credit card spends in April on a m-o-m basis. On a y-o-y basis though, State Bank of India’s (SBI) credit card spends rose 24% to Rs 24,335 crore, while those of HDFC Bank rose 31% y-o-y to 38,077 crore. ICICI Bank, Axis Bank and IndusInd Bank saw 9.4%, 70.1% and 21.72% y-o-y rise in April at Rs 22,693 crore, Rs 15,647 crore and `6,314 crore, respectively.
Further, the number of credit cards outstanding at the end of April was 86.5 million, 1.21 million higher than March. While HDFC Bank’s outstanding credit cards rose 2% m-o-m in April to 17.88 million, SBI’s cards grew 0.6% m-o-m to 16.86 million during the month. ICICI Bank and Axis Bank, meanwhile, increased their credit card base by 0.8% and 1.2% on a monthly basis to 14.58 million and 12.27 million during April respectively, the data showed.
According to a report issued by HSBC Global Research on Monday, the issuance and usage of ‘RuPay credit card on UPI’ should further boost credit card spends going ahead, and building of a RuPay credit card portfolio would be an additional growth lever for any issuer as it would help bypass the limitations of point of sale (PoS) terminals and reduce friction at the acceptance points.
Earlier this month, Axis Bank enabled the linkage of RuPay credit cards with Unified Payments Interface (UPI). “With approximately 250 million customers using UPI for their peer-to-peer and merchant payments, the linkage of RuPay credit cards with UPI will lead to a rise in acceptability through the vast network of 50 million UPI merchants, providing customers with more points of acceptance of their credit cards,” said Sanjeev Moghe, president and head of cards & payments at Axis Bank.
Apart from Axis Bank, Canara Bank, HDFC Bank, Indian Bank, Punjab National Bank and Union Bank of India are the other lenders which offer their customers an option to link their RuPay credit card with UPI.