Credit card spending in India hit Rs 2,023 billion in May, showing a 6.6% increase year-on-year and a 2.6% rise from the previous month. This growth follows a 10.1% decline in April, signaling a gradual recovery rather than a robust one, according to a report by Asit C. Mehta Investment Intermediates Limited.
In May, the industry issued 1 million new cards, the second-highest monthly issuance in the last 27 months. The total number of cards in circulation rose to 120.5 million, with a year-on-year growth of 8.7%, the highest in 15 months.
Transaction volumes reached 587 million, up 5.7% sequentially and 25.8% annually, mainly rebounding from the significant drop in April. Average spend per card decreased by 1.8% year-on-year but increased by 1.7% compared to the previous month, except for SBI, which saw a 12% rise in per-card spending due to increased corporate expenditures.
The average spend per transaction decreased by 3% month-on-month and 15% year-on-year, reflecting a trend towards lower-value transactions. Despite holding a 76% market share in spending, the top four banks only accounted for 63.7% of the incremental spending in May.
Among the top four banks, all showed similar sequential growth except HDFC Bank, which grew by 4.2%. Another report indicated a 36% year-on-year increase in credit sourcing for new loans in Q3 FY26, driven by sustained demand from consumers and businesses, signaling robust lending activity and improving asset quality.
