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Credit card industry grows by 44% YoY: CRIF CreditScape

CRIF high mark, one of the leading credit bureaus, has released the ‘CRIF CreditScape: Credit Cards’, to dive deep into trends and analysis for insights of the overall credit system in India with data points until December 2019.

CreditScape showed the credit card industry portfolio at a remarkable Rs 1,24,390 crore reflecting a 44% y-o-y growth with active cards in circulation at 50.1 million with a 25% y-o-y growth. Borrowers opting for a credit card for the first time increased by 3x in a span of 4 years. With a CAGR growth of 22% spread over 4 years, the active card borrowers as of September 2019 was at 3.25 crore. For the next 5-6 quarters, 1 million additional credit cards are forecasted to be sourced. In the last year the overall volume delinquency in the credit card industry improved by 5bps and credit card sourcing volume reflected a growth to 2.87 million from 0.71 million between Q1 FY 2014-15 to Q4 FY 2017-18. Interestingly, this growth has been leaning towards lower ticket sizes with a share of <10K high credit segment doubling in 4 years to reach at 45% in FY 2019-20 till Dec 2019.While y-o-y growth is steeper in Tier II cities, as of Dec 2019 metros constitute 60% of the active card base.

Navin Chandani, MD & CEO, CRIF High Mark said, “Credit card, once considered a product of the affluent in major metros has expanded to a large variety of consumers in tier II and tier III cities as well. The Indian credit card portfolio has grown 44% and active cards in force have increased by 25%, respectively year on year. The credit card industry has benefited from larger internet and smartphone penetration, advancements in e-commerce and alliances between Merchants & Banks in the form of co-branded cards. Non-metro customers who were earlier conservative about personal debt and had limited access to credit cards are now warming up to the use of credit cards. This will solve for the under penetration in the market and presents a huge potential.”

Source: Publication: ETBFSI | 8th May 2020