Comments
Credit card issuances and spends continued to remain robust in May in an indication that the retail economy continues to be strong, said experts.
According to data from the Reserve Bank of India, there were 7.68 crore outstanding credit cards in May 2022, which was about a 2.2 per cent increase from 7.51 crore in April. On a year-on-year (y-o-y) basis, this was a jump of 23.3 per cent from 6.23 crore credit cards in force in May 2021.
Credit card spends also remained well above the ₹1-lakh crore mark in May despite inflationary pressures and rising interest rates. Total credit card spending in May was at ₹1.13-lakh crore, which was 7.8 per cent higher than ₹1.05-lakh crore spending in April. But credit card spending has more than doubled in the last year by 117.8 per cent from just ₹52,200 crore in May 2021.
“Latest data releases from RBI reveal that credit card spends have been very strong touching an all-time high level in May 2022,” said a note by Macquarie Research, adding that bounce rates by value are also at three-year low levels. “These data points indicate that the retail economy is strong,” it said but cautioned that with interest rates expected to rise rapidly in the next few quarters we need to see whether current trends are sustainable.
Also read
Outstanding credit cards
According to Motilal Oswal, the total number of outstanding credit cards in the system grew 23.2 per cent y-o-y in May 2022, which is the highest in the past 27 months. “Spends remained strong and continued their healthy momentum over May 2022, led by the rising share of e-commerce transactions, which will keep growth in spends buoyant,” it said.
Monthly spends per card for the industry grew five per cent month-on-month to ₹14,800, much higher than pre-Covid levels, it said. The ticket size of transactions was stable at ₹4,700-4,800, while the number of transactions per card rose to 3.1 per cent.
All players, barring American Express, saw an increase in monthly spends per card of up to ₹1,100, barring IndusInd Bank, which saw an increase of ₹3,900. HDFC Bank had the highest card issuances in May with about 3.85 lakh new cards.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.