Credit card spending decreased slightly on a month-on-month basis in February even as they remained above Rs 1 trillion for the 12th straight month, according to Reserve Bank of India (RBI) data. Credit card spending was nearly Rs 1.2 trillion in February, lower than Rs 1.3 trillion in January.
E-commerce sales comprised 62.4% of card purchases in February, followed by point-of-sale transactions for 37.5%, with other transactions making up the remainder.
“The decline in credit card spending is due to the fact that February has fewer days than other months. I expect credit card spending to stay strong in the future. Lately, we’ve seen credit cards being used for non-discretionary expenses like utility bills, which is a positive thing,” said the head of the credit card division at a small finance bank.
While preference for revolver credit has waned lately, credit card issuers are focusing on increasing their equated monthly installment (EMI) offers to attract more customers and increase revenue, experts say.
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Net credit card additions totaled 9.1 lakh in February, lower than 12.7 lakh in January.
Among major credit card issuers, Axis Bank experienced an increase in spending while ICICI Bank experienced a decrease. SBI Cards and Payment Services saw spending decrease by 9%.