Credit card spends surge to five-year high of over ₹2 lakh crore in September: CareEdge Ratings

Credit card spending in India touched an all-time high of ₹2.17 lakh crore in September 2025 — the highest in the past five years — marking a 23% year-on-year (y-o-y) and 13% month-on-month (m-o-m) rise, according to data analysed by CareEdge Ratings.

The surge was driven by festive season demand, increased card issuance, GST rate cuts on select consumer goods, and aggressive bank-led promotional offers.

While the expansion in spends remained strong, CareEdge noted that the growth was slightly below the 24% increase recorded in the same month last year, suggesting a moderation in momentum even amid robust consumption trends.

Private banks lead, but public lenders close the gap

Private sector banks (PVBs) continued to dominate India’s credit card market with a 74.2% share of overall spends in September 2025. However, this represented a 130-basis point decline compared to the same period last year, reflecting a mild loss of ground to public sector banks (PSBs).

PSBs, on the other hand, expanded their share to 21.2%, up from 18.4% a year earlier, aided by deeper penetration in tier-2 and tier-3 cities and more competitive digital and rewards offerings.

CareEdge noted that spending among PSBs remains concentrated among a few large state-owned lenders, while smaller PSBs together contribute less than 1% of total spends.

Card base expands, but growth slows as lenders focus on quality

The total number of credit cards in circulation rose to 11.3 crore in September 2025 from 10.6 crore a year earlier, translating into a 7% annual rise.

Though the increase reflects steady card adoption, it is well below the 14% y-o-y growth seen in the same period last year.

CareEdge attributed this moderation to banks’ shift toward high-quality customer acquisition, amid rising delinquencies in unsecured retail loans.

Most of the incremental growth continues to come from private banks, which rely on co-branded partnerships and enhanced digital experiences to deepen engagement.

PSBs see sharper rise in per-card spends

Overall, average spending per card increased 15% y-o-y to ₹19,144 in September 2025, compared to ₹16,645 a year earlier.

Private banks recorded per-card spends of ₹20,011, up 3% from last year. Interestingly, PSBs reported a 30% jump in per-card spending, reaching ₹16,927, helped by upgrades in digital platforms, richer reward structures, and improved credit offerings.

CareEdge observed that high-value transactions and online purchases drove much of the spending uptick, with e-commerce and travel segments showing notable traction.

Outstanding balances show mild contraction

Despite record spending, outstanding credit card balances fell marginally to ₹2.82 lakh crore in September 2025 from ₹2.89 lakh crore in August. On a yearly basis, balances were up 3.7%, indicating moderation compared with double-digit growth trends seen in earlier periods.

The share of credit card outstandings in total retail loans declined to 4.5%, from 4.9% a year earlier — a sign that other segments such as housing and vehicle loans are expanding faster than unsecured credit.

Outlook

CareEdge noted that the record high spending in September was the outcome of a “confluence of factors” — festive offers, sustained digital adoption, and rationalised GST rates that made big-ticket items more affordable.

The firm expects the momentum in card-based consumption to remain healthy in the near term, though lenders are likely to remain cautious on unsecured exposure as household leverage edges higher.Read about our editorial guidelines and ethics policy