India's Credit Card Spending Skyrockets to Record ₹2.17 Lakh Crore in September 2025!

India witnessed a historic surge in credit card spending, reaching an unprecedented ₹2.17 lakh crore in September 2025. This represents a substantial 23% year-on-year (YoY) and 13% month-on-month (MoM) increase, according to CareEdge Ratings. The primary drivers for this record spending spree included strong festive season demand, a rise in credit card issuance, reduced GST rates on certain consumer goods, and aggressive promotional offers from banks. However, CareEdge noted that the YoY growth momentum slightly moderated compared to the same period last year.

Private sector banks (PVBs) maintained their dominance, accounting for 74.2% of total credit card spends. Yet, their market share saw a marginal decline of 130 basis points YoY. Conversely, public sector banks (PSBs) expanded their share to 21.2% from 18.4% a year ago, driven by enhanced penetration in tier-2 and tier-3 cities and competitive digital offerings. Spending among PSBs, however, remains concentrated among a few large lenders.

The credit card base grew by 7% YoY to 11.3 crore cards, a slower pace than the 14% growth seen previously. This deceleration is attributed to banks prioritizing high-quality customer acquisition amidst rising delinquencies in unsecured retail loans. Incremental growth predominantly came from private banks leveraging co-branded partnerships and digital experiences.

Average spending per card rose by 15% YoY to ₹19,144. Notably, PSBs saw a significant 30% jump in per-card spending, reaching ₹16,927, boosted by improved digital platforms and reward structures. High-value transactions and online purchases, particularly in e-commerce and travel, fueled this spending uptick.

Outstanding credit card balances saw a marginal contraction, falling to ₹2.82 lakh crore in September 2025 from ₹2.89 lakh crore in August, with YoY growth moderating to 3.7%. The share of credit card outstandings in total retail loans decreased to 4.5%.

Impact: This news indicates robust consumer sentiment and spending power, which is positive for banks' credit card businesses and consumer discretionary sectors. However, the slight moderation in growth momentum and focus on quality customer acquisition suggest a cautious outlook on unsecured lending. Rating: 7/10.

Difficult Terms: Basis Point (bps): A unit of measurement equal to one-hundredth of a percentage point. 100 basis points = 1%. Delinquencies: Failure to make required payments on a debt. Unsecured Retail Loans: Loans given to individuals that are not backed by any collateral or asset. GST: Goods and Services Tax, a consumption tax. YoY: Year-on-Year, comparing data from one year to the same period in the previous year. MoM: Month-on-Month, comparing data from one month to the previous month. E-commerce: Buying and selling of goods or services using the internet. Traction: The progress or development of a company or product.