CREDIT CARDS HAVE been around for a few decades. In fact, it is the primary mode of payment for purchases in many countries. But in India, they had never really taken off as they were seen as being out of bounds for most of the salaried, and retailers were reluctant to accept them.
That is, however, a thing of the past. Not only are more and more people getting credit cards, but also they are using them more frequently. The most recent data on payments and settlement systems by the Reserve Bank of India says the number of active credit cards in India was ₹9.13 crore in August 2023. It was just ₹7.8 crore a year before that-that is a 17 per cent growth. In January 2020, it was just ₹5.6 crore. So, in some three and a half years, the number of credit cards surged 63 per cent.
The growth in credit card usage is even more impressive. In August this year, credit card spends touched ₹1.48 lakh crore, up 2.7 per cent from the month before that and up 32.3 per cent from August 2022.
What is driving this growth?
“The continued increase in discretionary spending on vacation, travel, entertainment and consumer durables in metros and beyond, and digital payments have propelled credit card usage in India,” said Puneet Bhatia, vice president, acquisition and product management, American Express Banking Corp. India.
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