CRIF CreditScape Report on Credit Cards

Key Observations:

·         As of Dec 2019, the credit card industry portfolio stood at ₹1,24,390 crores, a y-o-y growth of 44%. Active cards in circulation stood at 50.1 million (25% y-o-y growth) and the average outstanding balance per card saw a YoY growth of 16%.

• Overall volume delinquency in the credit card industry improved by 5bps in the last year.
• As of Sep 2019, there are 3.25 crore active card borrowers, having grown with a CAGR of 22% over 4 years. Borrowers opting for a credit card for the first time (NTP) has increased by 3X in a span of 4 years, standing at 64.4 lakhs in FY 2018-19.
• Credit card sourcing (by volume) has seen a largely steady quarterly growth between Q1 FY 2014-15 to Q4 FY 2017-18, increasing from 0.71Mn to 2.87Mn. Projections show that ~1Mn additional credit cards will be sourced over the next 5-6 quarters.
• Credit card sourcing (by volume) is increasingly tending towards lower ticket sizes. The share of <10K high credit segment has more than doubled in 4 years to reach 45% in FY 2019-20 till Dec 2019.
• Metros constitute 60% of the active card base as of Dec 2019 but the Y-o-Y growth is steeper in Tier II cities. Larger proportion of sourcing by Private banks in Metros by while Other card issuers incl. FRBs and PSBs display increasing focus in non-metro geographies.

Quote from Navin Chandani, MD & CEO, CRIF High Mark:

“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 has 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 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.”