Winning Bizness Desk

Mumbai. Indian consumers set a new record in credit card spending in July, with transactions reaching unprecedented levels. According to a report by SBI Securities, credit card holders across the country spent a staggering Rs 1.7 lakh crore in July 2024. This represents a significant 19% increase compared to the same period last year, highlighting the growing reliance on credit cards for transactions. The report further reveals that the number of transactions using credit cards also saw a sharp rise. A total of 38.4 crore transactions were recorded in July, marking a 39% year-on-year increase. This surge in both the value and volume of transactions indicates that credit cards are becoming as popular as Unified Payments Interface (UPI) for everyday purchases and larger expenses.

HDFC Bank emerged as the leader in credit card transactions

Among the banks, HDFC Bank emerged as the leader in credit card transactions. HDFC Bank's credit card users conducted 9.9 crore transactions in July, far exceeding the figures reported by other banks. ICICI Bank followed in second place with 7.1 crore transactions, while SBI Bank secured the third position with 6.3 crore transactions. In terms of the total amount spent, HDFC Bank also maintained its lead. The bank's credit cardholders spent a total of ₹44,369 crore in July. ICICI Bank ranked second with ₹34,566 crore in spending, and SBI Bank was third with ₹26,878 crore. This surge in credit card usage reflects a broader trend of increasing consumer confidence and a shift towards cashless transactions in India. The convenience of credit cards, coupled with the various offers and rewards programs provided by banks, appears to be driving this growth. As digital payments continue to expand, credit cards are expected to remain a key tool for consumers across the country.

What are the reason behind this?

Two basic trends are driving the significant increase in credit card spending in India, as seen in the recent surge reported for July 2024. These trends include:

1) Rising Consumer Confidence - The overall improvement in the Indian economy post-pandemic has led to greater consumer confidence. People are more willing to spend, particularly on big-ticket items like electronics, travel, and luxury goods, which are often paid for using credit cards.

2) Increased Online Shopping-The growth of e-commerce platforms has made online shopping more accessible and convenient, encouraging consumers to use credit cards for these purchases. Credit cards are preferred