Credit Card Business in India Reaches New Heights!


BANGALORE:  The use of credit card in the modern scenario is quite often. There has been a continuous increase in the number of cards issuing nowadays and recently, ICICI Bank embarked to add a gross of 0.3 million credit cards in FY14. This was quiet ahead than Axis and SBI banks that expanded to 0.27 million and 0.26 million respectively whereas City bank was limited to an increase of 0.05 million credit card issuance.

The reason for such a growth in the credit card users is the superior services offered by credit cards. On one hand where the debit cards offer zero or very small rewards, credit cards offer significant rewards if used responsibly and you might get 1-5 percent cash back on your purchase. And, the utmost factor that makes people to use credit cards is safety; it is easier to avoid losses from frauds.

Whereas, HDFC still leads the market with issuing highest number of credit cards. ICICI’s unsecured portfolios of credit cards and personal loans were at 7, 270 crore during the FY14 and was only 2.1 percent of the bank’s overall loan book. “The growth rate is high due to the low base,” N S Kannan, executive director of ICICI Bank told analysts on bank's earnings announcement in April, 2014, reports Business Standard.

But despite of heavy increase in the number of credit card issues, the total number of active credit cards were fewer, the reasons spotted as there has been a continuous cleaning out of inactive card. Though the number of credit cards might have reduced, the amount spent on the credit card transactions was estimated to be around 14, 577 crore this year compared to 12, 418 crore previous year.

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