Page 9 - Banking Finance April 2023

RBI CORNER

Reserve Bank

News

Credit growth of banks Credit card spends in Janu- ever, HDFC Bank saw a 1.3 per cent
decline despite an increase in outstand-
spikes up to 16.8% in De- ary 23 at over Rs. 1 lakh
ing cards.
cember quarter crore Even then, the private sector lender
Indian banks' credit growth doubled to continued to maintain its leadership
Credit card spends were above the Rs.
16.8% in the October-December quar-
1-lakh crore mark for the 11 th con- position in spends, with a market share
ter from a year earlier, data released of 28 per cent, followed by SBI Card,
secutive month in January, touching Dr.
by the Reserve Bank of India (RBI). which had a market share of 19 per
1.28-lakh crore during the month, ac-
Bank credit had expanded by 8.4% in cent.
cording to RBI data.
the quarter ended December 2021
Net card additions for the month were
Spends rose nearly 1 per cent on an al-
and 17.2% in the quarter ended Sep-
at 12.6 lakh or 1.6 per cent, higher
ready high base seen in December, when
tember 2022, as per the data.
than 5.8 lakh in December. This took
card spends stood at Rs. 1.26-lakh crore,
The growth in credit was led by bank total outstanding credit cards to 8.2
led by a rise in e-commerce and online
branches in metropolitan centres, crore at the end of January.
transactions. Year-on-year, spends were
which accounted for nearly 60% of the
higher by around 45 per cent. The addition in the number of cards
total credit by banks, the RBI said.
was led by SBI Card, which saw a net
Urban, semi-urban and rural centres Credit card spends had touched a peak
increase of 3.3 lakh, followed by HDFC
also recorded double-digit credit of Rs. 1.29-lakh crore in October 2022
Bank seeing a rise of 2.2 lakh, Axis
growth, it added. amid rise in festival season-led transac-
Bank of 1.4 lakh and ICICI Bank of 1.3
The growth of state-owned lenders' tions. lakh on month.
credit portfolios jumped, rising by
Online e-commerce sales comprised
15.7% during 2022 as compared with RBI may hit the pause but-
over 61 per cent of the card spends in
4.7% in 2021. Corresponding growth
January, followed by PoS (point of sale) ton on rate hike next
for private banks remained higher,
transactions at 38 per cent and other
however, at 19.1%, from 13.1% in month
transactions forming the rest. Spends
2021, as per the data. Even as India's retail inflation remained
were largely led by transactions per-
With India's economy on the mend fol- above RBI's tolerance limit of 6% for
taining to travel, tourism and shopping,
lowing the COVID pandemic, credit the second consecutive month in Feb-
said industry participants.
offtake has improved and most banks ruary, global brokerage firm Nomura
Most major credit card issuers such as
now expect double-digit credit growth expects the central bank to not in-
for the current financial year ending in ICICI Bank, Axis Bank and SBI Card saw crease interest rates in its April
a single-digit increase in spends; how-
March 2023. meeting.
8 | 2023 | APRIL | BANKING FINANCE