The rise of cards has revolutionized consumer culture, promoting economic growth and retail transformation. Over the past few years, the country has witnessed a remarkable rise in card adoption, reflecting a shift toward digital payments and modern consumer lifestyles. Credit cards have become a catalyst for retail expansion, convenience-driven spending, and a more connected financial ecosystem. This surge captures the spirit of a nation embracing innovation and aspiration through its changing payment habits.
From Cash to Credit: The Transformation of Spending
The number of active credit cards has grown to over 111 million as of June 2025, doubling from around 54 million in 2019. In September 2025 alone, there is an increase in credit card spending, a growth of 13.33% MoM and 22.91% YoY, reaching 2.17 lakh crore in September 2025. Volume jumped 26.2% YoY, with e-commerce-related transaction value reaching Rs 1.44 lakh crore in September, registering a jump of 24.95% YoY and 21.74% MoM. E-commerce-related value transactions contributed 66.39% of the total credit card transaction value. The GST rate cut, which lowered tax burdens on several categories, encouraged household and lifestyle purchases. Other factors, such as high festival demand, seasonal offers, cashback deals, and easy credit access, gave further impetus to such an astounding growth.
Cards in Command: The Market Leaders
According to recent reports from the RBI, the number of active credit cards in circulation surpassed 11 crore in FY25, reflecting a YoY growth of 8%. Key players, including HDFC Bank, ICICI Bank, SBI Cards, and Axis Bank, which have the highest number of cards in force, saw strong momentum in transactions in September 2025. The top 4 players controlled 78% of the total credit card transactions in terms of value as of September 2025.
- HDFC Bank has 2.38 crore credit cards in force as of FY25 and is considered to be the largest card issuer in India, which saw credit card transactions grow in value terms of 15.91% YoY, reaching Rs 60,689 crore as of September 2025, compared to Rs 52,356 crore in September 2024.
- SBI Cards has a 19.0% market share in cards in force with 2.15 crore cards as of Q2FY26. It witnessed an astounding growth of 46.48% YoY and 22.83% MoM, with total credit card transaction value standing at Rs 40,677 crore.
- ICICI Bank also has 1.8 crore credit cards in force as of FY25, which witnessed a transaction value growth of 33.22% YoY and 21.52% MoM in September 2025. It has a total credit card transaction value standing at Rs 41,950 crore as of September 2025.
- Axis Bank has a 14% market share in credit cards in force, with 1.50 crore credit cards. It also saw a high jump of 39.04% YoY and 19.65% MoM, with the total transaction value standing at Rs 26,082 crore as of September 2025.
- Kotak Mahindra Bank offers credit cards for shopping, travel, entertainment, and cashback. As of August 2024, the bank had more than 54.13 lakh credit cards.
- RBL Bank has distributed more than 44.70 lakh credit cards as of September 2025, with 4.04% market share. It has more than 40 credit cards catering to different categories.
- IndusInd Bank launched its credit card services in 2013, and now has a credit card AUM of Rs 10,747 crore as of September 2025.
- IDFC First Bank entered the credit card industry in 2021 and developed credit cards for high-end customers and the masses. It has around 40 lakh cards as of September 2025, with a market share of 3.56%.
- Bank of Baroda (BoB) ranked 9th in terms of market share of cards, with a share of 2.7% and a spending share of 1.7% as of March 2025.
The Next Phase of Credit Penetration
Despite this rapid growth, India presents significant growth potential in the credit card market, with an average card ownership of around 8 per 100 individuals as of March 2025. Global competitors are comparatively higher in penetration with key countries, such as 222 in Brazil, 54 in China, 66 in Australia, 82 in the UK, 251 in South Korea, and 360 in the USA.
India has been continuously working on strengthening its payment infrastructure ecosystem. Overall, digital payments in terms of value have grown by 18% CAGR in the past three years, while UPI accounted for 46% growth during the same period. Meanwhile, digital payments in India continue to thrive and are expected to triple by FY28-29. On the other hand, merchants acquiring infrastructure through both online and offline channels have also witnessed rapid expansion, particularly in Tier 2, 3, and 4 cities.
India’s e-commerce market is estimated to reach around Rs 26 lakh crore by 2030, from Rs 10 lakh crore in 2024, growing by approx. 17-18% CAGR. It will play a crucial role in credit growth as credit acceptance is growing, and retail Credit grew at 12% YoY as of March 2025. While there is some moderation in retail loans after March 2025, as RBI data shows, credit to the personal loans segment recorded a decelerated YoY growth of 11.7% largely due to the moderation in growth of segments like personal loans, vehicle loans, and credit card outstanding. The number of credit cards in India is projected to reach 200 million by FY28-29, growing at a CAGR of 15%, according to a PwC report.
Precautionary statements
The rapid surge in credit card usage comes with a cautionary note, as it signals a shift in consumer behavior toward greater credit dependence. Consumers are increasingly using credit cards not just for big-ticket purchases but also for everyday spending. It tells us that the Indian household, which used to be a savings-centric society, is transitioning towards unsecured credit to fund aspirational spending. As per the World Bank, India’s gross domestic savings as a % of GDP has decreased from its highest level of 34.3% in 2010 to 28.4% in 2024, while it is higher than the global average of 25.9%. Household debt in India increased to 42% of GDP in the first quarter of 2025 from 41.90% of GDP in the fourth quarter of 2024. It has been increasing consistently since COVID. In Q1 of 2019, household debt in India stood at 34%.
Upsurge in credit card spending exposes risk, such as an uncertain job market, especially with rising automation and global demand shifts. Any serious downsizing in companies (recent mass layoffs from major companies like Amazon, Starbucks, Oracle, and Nike) will create serious stress on the savings of the household.
Final thoughts
The rise in credit card use in India is indicative of a dynamic, digital, aspirational economy in transition. However, financial restraint and regulatory attention must match this quick growth. India’s credit journey should encourage consumption without depleting savings to achieve sustainable growth. The real success of this change will depend on striking a balance between practicality and caution, making sure that financial empowerment does not result in long-term vulnerability.
Written by Ashish Sengupta
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