MUMBAI: Indicating the rising indebtedness of households and individuals or their spendthrift nature expecting better earnings going ahead, credit card spends soared 23 percent on-year and 13 percent sequentially to Rs 2.17 trillion in September--the highest since 2020.
According to an analysis by Care Ratings, however, the total outstanding credit card balances stood at Rs 2.82 trillion in the reporting month marginally down from Rs 2.89 trillion in August 2025 and up from Rs 2.72 trillion in September 2024, indicating a moderate annual growth of 3.7 percent and a sequential decline of 2.38 percent.
Accordingly, the share of credit card outstanding balances in total retail loans has also fallen marginally by 40 bps to 4.5 percent in the reporting moth from 4.9 percent a year earlier. The agency attributed the spike to bank-led festive offers in the run-up to the festive month, increasing consumer demand driven by the festive spending induced by GST rate cuts, along with increased card issuances in the month.
While the growth rate for the reporting month remained robust, it was slightly lower than the 24 percent expansion seen a year ago. Private sector banks maintained their dominance in the credit card spends market with a 74.2 percent share in September, although this was a 130-basis point lower annually, while public sector banks increased their share to 21.2 percent from 18.4 percent.
The total number of outstanding credit cards grew from 10.6 crore in September 2024 to 11.3 crore in September 2025, reflecting a steady increase in card penetration, indicating an annual increasing of 7 percent and an on-month growth of 1%, attributed to an expansion in credit card adoption and usage. Private banks’ average spending per card in September was Rs 20,011, up 3 percent, while that of their state-run peers saw a more significant increase of 30 percent, with per-card spending rising to Rs 16,927, primarily due to enhanced digital and rewards offerings, apart from their focus on urban, higher-income customers with larger credit limits.
Despite the steep rise, the share of credit card outstanding balances in total retail loans declined to 4.5 percent in September from 4.9 percent a year earlier, indicating a relative slowdown in credit card outstanding even as other retail segments expanded. When it comes to market share, public sector banks have a relatively smaller presence, with their spending market share rising above 20 percent, concentrated among a few large ones and the smaller one contribute marginally to this segment, holding just 0.5 percent of the total spending.
Overall, per-card spending stood at Rs 19,144, a 12.2 percent on-moth uptick from Rs 17,052 in August, and a 15 percent on-year rise from Rs 16,645 primarily due to festive tailwinds, rising digital and e-commerce adoption, and bank-driven incentives, with a marked shift toward higher-ticket, value-driven transactions.