Thursday, 20 Nov, 2025
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Amid record festival spending and GST rate cuts, average credit card expenditure jumped 15% Y-o-Y in September, RBI data show.
The credit card spending surged to an all-time high in September, lifted by festive-season shopping and recent reductions in goods and services tax (GST) rates that helped spur consumer sentiment. Data from the Reserve Bank of India (RBI) show that the average monthly spend per card jumped 15 per cent year-on-year to Rs 19,107.6—the sharpest increase since the pandemic rebound began.
The rise signals renewed strength in discretionary spending as consumers took advantage of festive discounts and reward-based offers. Analysts say this momentum reflects a broader shift toward digital and credit-led consumption, particularly in urban India, even as inflation remains a pressure point.
Private banks extend their lead
HDFC Bank continued to dominate the market, recording the highest average spending per card at Rs 23,959.8—up 2.8 per cent from a year earlier. ICICI Bank followed closely, posting a 27.4 per cent increase to Rs 22,817.6. Axis Bank also saw a strong 33.4 per cent jump to Rs 16,884.6, while SBI Cards’ per-card spending climbed 33.5 per cent to Rs 18,892.3.
Together, these four top lenders accounted for Rs 26,000 crore in total credit card expenditure during the month, underscoring their grip on the fast-expanding consumer credit landscape. Much of the boost came from exclusive tie-ups with major e-commerce players such as Amazon and Flipkart during their annual festival sales, which offered card-linked discounts and zero-interest equated monthly instalment (EMI) schemes.
Higher-value purchases have driven spending this year. With transaction volumes largely unchanged, the average amount spent per transaction rose 13 per cent month on month, indicating that customers are increasingly using their cards for larger-ticket purchases.
Public-sector banks, long trailing their private peers in this segment, are also catching up. According to CareEdge Ratings, several state-run lenders have improved their digital offerings and expanded partnerships with retailers, helping them attract more affluent urban customers. Many have rolled out new cashback and co-branded cards, boosting card utilisation and overall spend.
Festival season & GST cut
Industry experts attribute the September jump largely to the overlap of festive-season shopping and tax changes that made certain consumer products cheaper. The government’s “GST 2.0” rationalisation, which reduced rates on smaller cars and some electronics, coincided with retailers’ heavy discounting, creating what one analyst described as “the perfect spending storm.”
The timing worked perfectly. Households were already primed to spend, and the GST relief made big-ticket items more affordable. Combined with card rewards and cashback deals, it amplified festival spending.
A survey by Paisabazaar found that 42 per cent of credit card users spent more than Rs 50,000 in September, a figure that highlights the growing role of cards in the country’s consumption economy. It shows credit cards are no longer just a convenience tool— they’re a core part of household spending strategy.
Online shopping continues
RBI data show that total credit card spending in September reached Rs 2.17 lakh crore, a record high. Online purchases accounted for Rs 1.44 lakh crore, up 25 per cent from a year earlier, while transactions at physical point-of-sale (POS) terminals rose 19.2 per cent to Rs 72,544 crore.
This steady rise in online expenditure highlights how digital payments continue to reshape India’s retail landscape. Analysts say banks are driving the trend by offering app-based benefits, instant reward redemption, and exclusive online partnerships that encourage customers to swipe — or click — more often.
The convergence of technology, marketing, and credit is redefining consumption. E-commerce platforms and card issuers are increasingly intertwined, creating a digital ecosystem that fuels repeat spending.
Credit card base expands
The number of credit cards in circulation climbed by 1.05 million in September, bringing the total to 113.4 million. A year earlier, the monthly net addition was 620,000, taking the total to 106.11 million.
The expansion reflects deepening consumer credit market, driven by higher disposable incomes, a growing middle class, and broader digital access. Analysts say the shift also signals a change in attitude toward short-term borrowing, as consumers become more comfortable managing credit responsibly.
With the festival quarter extending into October and November, banks expect spending to remain elevated well into 2025. As India transitions toward a more consumption-led economy, the September data underline a key trend: credit cards are no longer just a payment instrument — they are powering India’s urban growth story.
