Credit card spends hit all-time high
Credit card spends hit an all-time high in July owing to a sharp rise in transactions on e-commerce websites. The spends rose nearly 25% year-on-year(y-o-y) to Rs 1.5 trillion in July, latest data showed. Month-on-month (m-o-m), the spends were up 5.5%.
E-commerce transactions clocked an all-time high of Rs 95,108 crore in July while transactions at point of sale terminals was at Rs 49,628 crore in the month under review. Credit card spends rose 26% y-o-y in June.
The spends by Axis Bank users rose 75.4% y-o-y to Rs 17,699 crore in July, the highest among all banks. Kotak Mahindra Bank’s credit card spends rose 52.1% y-o-y to `5,546 crore. For Bank of Baroda, it rose 65.3% y-o-y to Rs 2,122 crore in the month under review.
The spends of SBI Cards and Payment Services, India’s only listed credit card issuer, rose 34.1% y-o-y to Rs 26,011 crore in July.
The spends market share of ICICI Bank and Axis Bank rose m-o-m whereas HDFC Bank’s spends market share fell.
“Industry receivables to trailing spends (historically correlated with revolver mix) rebounded m-o-m to 12.7% (+50bps m-o-m), and is well above Jun e22 levels of 11.7%,” brokerage firm Jefferies said in a report.
“Stable to higher receivables to spends for the industry suggest revolver mix for the industry is likely bottoming out. We forecast revolver mix at SBI Cards to stay stable y-o-y at 24% in FY24,” the report added.
Outstanding credit cards rose 12% y-o-y to 89.9 million as on July 31. It stood at 88.7 million as on June 30.
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