Credit card issuances in India climbed to a seven-month high in August 2025, with nearly 700,000 new cards distributed. The total active cards now stand at 112.3 million, as banks like HDFC, Axis, and ICICI ramped up distribution ahead of festive demand. Despite flat monthly spends at ₹1.91 lakh crore, year-on-year growth hit 28%, underscoring robust consumer sentiment across travel, lifestyle, and online shopping categories.
Core Development
Regulatory data shows HDFC Bank led the market, adding 221,000 cards in August, taking its base to 25 million. Axis Bank followed with 140,000 additions, and ICICI Bank nearly doubled distribution with 130,000 cards issued. SBI Cards added 69,500, while Kotak Mahindra Bank expanded by 6,000.
By contrast, RBL Bank saw a decline of 100,000 cards, shrinking its active base to 4.5 million, though it expects festive demand to revive momentum.
Key Drivers / Issues
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Festive demand: Lenders geared up with festive campaigns, cashback, and bundled offers.
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Category growth: Electronics, travel, lifestyle, and dining drove spending.
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Consumer confidence: Spends stayed flat MoM but surged 28% YoY.
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Policy push: GST benefits and tax incentives supported retail consumption.
Stakeholder Impact
For consumers, competitive offers enhance affordability and access to credit. Banks and card issuers see higher volumes and opportunities in premium categories. Retailers benefit from rising festival-linked discretionary spending. However, regulators will keep a watch on rising unsecured credit exposure.
Industry & Policy Reactions
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Frederick D’souza, Kotak Mahindra Bank, noted strong momentum in online and lifestyle spends.
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Bikram Yadav, RBL Bank, highlighted optimism for e-commerce and electronics-led festive spending despite recent portfolio contraction.
Challenges Ahead
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Ensuring credit quality as unsecured retail lending rises.
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Managing customer retention amid aggressive competition.
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Sustaining growth beyond the festive season.
Strategic Outlook
India’s credit card market is entering a phase of renewed expansion, with festive demand acting as a catalyst. Growth will increasingly be driven by premium spending categories, online transactions, and younger consumers, but disciplined risk management will be critical to long-term sustainability.
Why This Matters
The surge in issuances signals not just festive optimism but a structural deepening of India’s consumer credit ecosystem, where cards remain central to digital commerce growth.
