India credit-card spending growth slows in August as competition intensifies
Credit-card spending rose 5.5%-5.9% year over year in August, down from 7.1% in July, even as cards in force grew 10.3%. HDFC Bank gained spending share, while SBI Cards’ growth slowed sharply and smaller issuers continued to gain ground.
What happened
India credit card industry · India’s credit-card spending growth remained muted in August despite steady card additions. Smaller issuers gained share, while
Key facts
- Credit cards-in-force grew 10.3% YoY in August 2026 versus 10.1% in July
- Net card additions were about 1.2 million in August versus 1.3 million in July
- Credit-card spending rose 5.9% YoY per HSBC and 5.5% per Jefferies, versus 7.1% in July
- Merchant-network spending including cards and UPI P2M rose about 19% YoY to Rs 11.3 trillion
- HDFC Bank spending share increased by 137-140 bps MoM to about 30%
- SBI Cards spending growth fell to 7% YoY from 22%; share fell to 17.5% from 19%
- SBI Cards card base grew 7.6% YoY, with 0.19 million net additions
- UPI MDR of 0.4% applies to eligible P2M transactions above Rs 2,000; credit-card MDR is roughly 1-3%
Why this matters
Share gains by HDFC and smaller issuers suggest partnership, acquisition, and distribution opportunities in differentiated card propositions as scale alone becomes less effective at driving spend.
What to watch
- September-October card spending growth versus festive-season historical patterns
- Spending per card and active-card ratios, not only cards-in-force growth
- SBI Cards monthly transaction growth, market share and marketing/reward expense commentary
- HDFC Bank card-spend share gains and premium-card activation trends
- RBI data on unsecured credit growth, delinquencies and issuer risk-tightening
- Scale of e-commerce, travel and merchant-funded festival offers
- Changes in interchange, MDR, reward-program economics or regulatory guidance
- Large issuers will intensify targeted offers around festive-season categories such as e-commerce, travel, electronics and discretionary retail.
- SBI Cards is likely to prioritize reactivation, co-brand partnerships and merchant-funded promotions to stabilize spend share.
- HDFC Bank and private-bank peers will push premium-card upgrades and relationship-based cross-sell rather than purely volume-led card issuance.
- Smaller issuers and fintech-linked card programs will continue using niche rewards and digital onboarding to capture incremental customers.
- Retailers and marketplaces may receive more bank-funded EMI, cashback and instant-discount proposals as issuers compete for transaction volume.