New Delhi, April 28: A report released on Tuesday indicates that credit card spending in India rose by 24% in March, reaching ₹2,194 billion. This increase is attributed to seasonal factors and a low comparison base from the previous year. However, consumption growth appears to be stabilizing.
According to the report by Asit C. Mehta Investment Intermediates, the year-on-year growth stands at 8.9%, which is relatively modest.
The report notes that the sharp month-on-month increase in spending does not reflect a sustained demand surge. Instead, it results from seasonal spending and statistical effects. The sector is now transitioning from a growth phase to a more normalized state.
The number of credit cards has also seen an uptick. The total active cards increased by about 8%, reaching approximately 118 million, indicating a steady rise in users.
In March, around 930,000 new credit cards were issued, marking a 7.96% increase compared to the previous year. This suggests that the primary driver of growth is the addition of new customers rather than a significant rise in per capita spending.
However, spending patterns show mixed trends. The average spend per card increased by 22.8% month-on-month, yet only rose by 0.9% year-on-year.
Similarly, the average spend per transaction also increased month-on-month, but the year-on-year trend continues to decline, indicating limited improvement in consumption intensity.
Earlier reports indicated that credit card spending in February had grown by 6% year-on-year, but month-on-month, it fell to ₹1,772 billion, reflecting an 11% decrease.
In February, approximately 1.05 million new cards were issued, which was a 7.7% increase year-on-year.
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