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Private Banks Lead Credit Card Boom Amidst E-commerce Surge
6 Mar
Summary
- Credit card spending grew 8.1% year-on-year in January 2026.
- Private banks dominate credit card spending with 72.8% market share.
- Online transactions comprise over 61% of total credit card usage.
Credit card spending increased by 8.1% year-on-year as of January 2026, reaching ₹2.05 lakh crore, primarily driven by sustained e-commerce activity. However, this growth rate is lower than the previous year's 13.8%, attributed to a base effect. The total outstanding credit card balance slightly decreased to ₹2.95 lakh crore in January 2026 from ₹2.92 lakh crore in January 2025.
Private sector banks (PVBs) maintained their dominance in credit card spending, holding a 72.8% share in January 2026, though this saw a 300 bps decline year-on-year. Public sector banks (PSBs) increased their market share, improving digital onboarding and expanding into tier-2 and tier-3 cities. Spending growth is anticipated to remain moderate but resilient, bolstered by services consumption and digital commerce expansion.
Online transactions, predominantly e-commerce, represented over 61% of total credit card usage, showing a stable share. While PSBs saw a significant 31.5% year-on-year growth in online transactions, PVBs grew at 2.7%. Offline transaction growth outpaced online at 9.4%, but incremental growth remains concentrated online.
The total number of outstanding credit cards grew to 11.7 crore in January 2026 from 10.9 crore a year prior. PVBs led issuance with 7.6% year-on-year growth, supported by distribution and partnerships. Foreign banks, however, saw a contraction of about 6% in outstanding cards.
