Average Transaction Value Falls 13.5% as Everyday Spending Drives Growth in Credit Card Usage
India’s credit card industry continues to witness strong growth in transaction activity, but fresh data suggests consumer spending patterns are undergoing a significant shift. While Indians are using credit cards more frequently than ever before, the average amount spent per transaction is steadily declining, indicating a move toward smaller-ticket everyday purchases rather than large discretionary spending.
According to a new industry report by Asit C. Mehta Investment Intermediates, total credit card spending in India stood at nearly ₹1.97 lakh crore in April 2026. Although overall spending remained strong, the industry recorded signs of moderation after the sharp post-pandemic growth seen over the last few years.
The report showed total spends grew 7.1% year-on-year but declined 10.1% sequentially compared to March, which traditionally sees higher payments linked to financial year-end expenses, travel bookings, taxes and business-related transactions.
Consumers Increasingly Using Credit Cards for Daily Purchases
One of the biggest trends highlighted in the report is the sharp decline in average transaction value.
The average value per credit card transaction dropped 13.5% year-on-year to ₹3,546, while average spending per card remained broadly flat annually at ₹16,512 and declined 10.7% month-on-month.
Industry experts say the data reflects a structural shift in consumer behaviour, where credit cards are increasingly being used for:
- Food delivery
- Quick commerce
- Online subscriptions
- Grocery purchases
- Small e-commerce transactions
- Everyday digital payments
Instead of relying on credit cards mainly for travel, luxury shopping or large-ticket purchases, consumers are now swiping cards more frequently for routine daily spending.
Transaction Volumes Continue to Surge
Despite slower spending growth, transaction activity remained extremely strong across the industry.
India processed nearly 556 million credit card transactions during April 2026, representing a massive 23.8% increase compared to the previous year.
Analysts say the divergence between transaction growth and spending growth clearly indicates that consumers are making a larger number of smaller-value payments through cards.
The trend also reflects:
- Rapid digitisation of payments
- Increased online shopping penetration
- Expansion of UPI-linked credit products
- Rising acceptance of cards for small-value transactions
- Growth in subscription-based digital services
Industry experts believe India’s credit card ecosystem is gradually becoming more mass-market and transaction-driven.
SBI Cards Emerges as Strongest Performer
While HDFC Bank retained its leadership position in overall spending market share, SBI Cards emerged as one of the biggest outperformers in April.
The report stated that SBI Cards recorded:
- 29% year-on-year growth in spends
- The highest market share gain of 327 basis points
- Strong traction in corporate spending
SBI Cards currently holds around 19.2% share of total industry spends, making it one of the largest credit card issuers in the country.
Analysts believe aggressive customer acquisition strategies and strong corporate card demand contributed significantly to its performance.
Smaller Banks Rapidly Expanding Credit Card Business
The report also highlighted growing competition from mid-sized and emerging private sector banks.
Federal Bank reported:
- 51% growth in spends
- 133% rise in transaction volumes
- Strong increase in new card issuances
Meanwhile, IDFC FIRST Bank continued gaining momentum with:
- 24% growth in spends
- 36.4% growth in transaction volumes
- Consistent expansion in card market share
Industry observers say smaller banks are increasingly focusing on:
- Cashback-heavy cards
- Digital-first onboarding
- Co-branded partnerships
- Lifestyle and travel rewards
- Aggressive customer acquisition campaigns
These strategies are helping challenger banks gain traction against established industry leaders.
Some Large Private Banks Losing Momentum
The report also pointed to signs of slowdown among certain large private sector banks.
ICICI Bank reportedly saw:
- 7% decline in card spends year-on-year
Axis Bank recorded:
- Only 4% growth in spends
- Growth levels below overall industry averages
Collectively, the top four issuers — HDFC Bank, SBI Cards, ICICI Bank and Axis Bank — lost 77 basis points of spending market share sequentially during April.
Analysts believe intensifying competition and changing customer preferences are reshaping market dynamics within India’s credit card industry.
Credit Card Base Continues to Expand Rapidly
India now has nearly 119 million active credit cards in circulation, highlighting the continued expansion of formal consumer credit access.
Banks added approximately 0.8 million new cards during April alone, while annual growth in cards outstanding reached 8.15%, the highest level recorded in 14 months.
ICICI Bank added the highest number of new cards during the month at around 0.15 million cards.
Federal Bank and IDFC FIRST Bank also recorded strong growth in card additions, reflecting aggressive expansion strategies by smaller players.
Shift Toward a More Digital, Mass-Market Credit Ecosystem
Industry experts believe the latest data signals a broader transformation in India’s consumer payments ecosystem.
Instead of credit cards being viewed primarily as premium lifestyle products, they are increasingly becoming everyday spending tools integrated into:
- E-commerce platforms
- Food delivery applications
- Subscription ecosystems
- Digital wallets
- Small-value online transactions
The rise of cashback offers, instant EMI options, loyalty rewards and app-based financial services is also encouraging wider adoption among younger consumers and middle-income households.
Analysts say the next phase of growth in India’s credit card market will likely be driven not only by high-value discretionary spending, but also by recurring small-ticket digital transactions forming part of everyday consumer behaviour.