Public Sector Banks Outshine Private Lenders in Online Credit Card Transactions: Report
Synopsis
A recent report reveals that credit card spending in India surged by 8.1% YoY in January 2026, with public sector banks exhibiting remarkable growth, significantly outpacing private banks. E-commerce is driving this trend, accounting for over 61% of transactions.
Key Takeaways
Credit card spending in India surged by 8.1 percent YoY in January 2026.
Public sector banks displayed a 7.1 percent growth in outstanding cards.
E-commerce transactions comprised over 61 percent of total credit card usage.
Month-on-month spending saw a decrease of 2.3 percent .
Private sector banks continued to lead in card issuance with a 7.6 percent annual growth .
New Delhi, March 6 (NationPress) In January 2026, credit card expenditures in India surged by 8.1 percent year-on-year (YoY), reaching a total of Rs 2.05 lakh crore, primarily fueled by the growth of online shopping, according to a recent report.
The analysis from CareEdge Ratings revealed that public sector banks (PSBs) experienced a 7.1 percent YoY increase in the number of active credit cards, showcasing a remarkable performance compared to their private counterparts.
Digital payment methods continued to lead credit card activities, with e-commerce transactions comprising over 61 percent of the overall volume.
“Online transactions have seen a 7.3 percent YoY growth, with PSBs achieving an impressive 31.5 percent increase, greatly surpassing the 2.7 percent growth observed in private banks,” the report indicated.
A significant contributor to this growth was the SBI group, whose card issuance expanded by 7 percent, totaling 2.19 crore cards, as highlighted in the report.
On the other hand, foreign banks faced a decline of approximately 6 percent in their credit card portfolios, adopting a conservative growth strategy that focuses on premium clientele.
Despite the positive trends, the report noted that overall growth is showing signs of slowing down after a year-end surge in discretionary spending.
Month-on-month, expenses dropped by 2.3 percent.
Additionally, the report pointed out that the annual growth rate fell short of the 13.8 percent growth seen in January 2025, attributed to a high base effect.
“The total active credit cards increased from 10.9 crore in January 2025 to 11.7 crore in January 2026,” the report stated, reflecting a 7.1 percent YoY increase and a 0.8 percent rise from the previous month.
As of January 2026, the total outstanding credit card balances reached Rs 2.95 lakh crore.
Private sector banks (PVBs) maintained their lead in card issuance, with a 7.6 percent annual increase, bolstered by robust distribution networks and partnerships with e-commerce and fintech firms. “Within this category, smaller and mid-sized private banks contributed significantly to the new card issuances,” CareEdge Ratings mentioned.
Overall, credit card spending in FY26 has increased by nearly 13 percent YoY, amounting to Rs 19.7 lakh crore, as highlighted in the report.
Point of View
I observe that the significant growth in credit card transactions, particularly among public sector banks, reflects a changing landscape in digital payments. The dominance of e-commerce is reshaping consumer behavior, and while private banks still play a crucial role, the shift towards PSBs indicates a noteworthy trend in market dynamics.
NationPress
1 May 2026
Frequently Asked Questions
What was the YoY growth in credit card spending in January 2026?
Credit card spending in India rose by 8.1 percent year-on-year, reaching Rs 2.05 lakh crore.
Which sector outperformed in credit card transactions?
Public sector banks (PSBs) outperformed private lenders, showing a 7.1 percent YoY growth in outstanding cards.
What percentage of transactions was attributed to e-commerce?
E-commerce transactions accounted for over 61 percent of total credit card transactions.
How did foreign banks perform in terms of outstanding cards?
Foreign banks experienced a contraction of around 6 percent in their outstanding credit cards.
What was the total outstanding credit card balance in January 2026?
The total outstanding credit card balances reached Rs 2.95 lakh crore.
