Buoyed by the festival season euphoria, credit card spends for the first time crossed Rs 1 trillion in a month in October, revealed the latest figures released by the Reserve Bank of India (RBI) on Thursday.
Spends in October registered a growth of over 25 per cent month-on-month, despite a high base of last month. On a year–on–year basis, credit card spends jumped 56 per cent. In the corresponding period last year, credit card spends were to the tune of Rs 64,891.96 crore.
The earlier highest one-month spend came in September this year at Rs 80,477.18 crore. The month before, spends were nearly Rs 77,981 crore.
Spends recorded in the past few months have been much higher than that of pre-pandemic levels. In January and February of 2020, credit card spends were Rs 67,402.25 crore and Rs 62,902.93 crore, respectively.
“Credit card spends have been quite robust in the past few months owing to strong economic rebound. Also, October was a festival month. That could have led to higher growth in credit card spends,” said Suresh Ganapathy, associate director, Macquarie Capital.
Nitin Aggarwal, vice-president, research-banking sector, institutional equities, Motilal Oswal Financial Services, said, “Growth in credit card spends in the past few months signals economic revival. Card acquisition rates have picked up, bolstering spending power.”
Apart from online spends, physical spending, too, returned this festival season. This trend may persist, given an under-penetrated credit card market and digital spending seeing growth spurt. Card acquisition should also see double-digit growth, with HDFC Bank back in the market, ICICI Bank and SBI Cards maintaining healthy growth,” added Aggarwal.
