The credit card market saw a notable decline in new issuances, with only 7.8 lakh cards issued in October compared to 16 lakhs in the previous year
With just 7.8 lakh cards issued in October as opposed to 16 lakhs in the same month the previous year, the credit card industry saw a notable 45 per cent year-over-year decline in new card issuances. A report from Anand Rathi, cited by ANI, reveals that this was a slight improvement over the 7.6 lakh new cards issued in May 2024, but still marks a significant decline from the previous year’s numbers.
While a decline in new card issuances, the data shows that the market is recovering. The total number of cards in force (CIF) rose by 16 per cent over the previous quarter, indicating a positive trend and new card additions in October exceeded those in June 2024.
Credit card usage increased on the expenditure side. The total amount spent increased by 13 per cent from the previous year to Rs 1.78 trillion in October 2024. Additionally, transaction volumes increased by 35.4 per cent year over year to reach Rs 433 trillion, a sign of increased consumer spending.
Significant changes in consumer spending patterns were also seen. The proportion of overall spending that went to e-commerce fell from 65 per cent in September 2024 to 61 per cent in October. However, point-of-sale (PoS) transactions gained popularity, rising from 35 per cent to 39 per cent in the preceding month.
The report also noted that PoS transactions now constitute roughly 51 per cent of the total transaction volume, suggesting a move back towards in-store retail spending as consumer preferences evolve.
Although consumption and new credit card issuance growth have slowed from the previous year, the industry is showing indications of a sluggish rebound. There is a cautiously positive view of the credit card market despite changing consumer behaviors due to the increase in the number of cards in use and the consistency of spending patterns.
Despite a drop in new issuances, the credit card industry's steady recovery and transition to point-of-sale transactions indicate a possible resurgence. This evolving pattern indicates that consumer spending may continue to maintain market stability in the foreseeable future.