The overall industry growth slipped into negative territory for the first time since the onset of the Covid-19 pandemic.
Credit card spends were also down to a four-month low of ₹1.83 lakh crore while they grew by a little over 5% over June 2024 when spends stood at ₹1.73 lakh crore.
ICICI Bank‘s total cards in use dropped by about 287,000 over May to 17.9 million at June end. Kotak Mahindra Bank also saw a sharp drop of 286,000 cards, while RBL Bank lost over 47,000 cards and Axis Bank saw a decline of around 6,000.
“We keep monitoring our portfolio and we believe that the quality of the book that we have built is quite stable. In case there are early signs of stress, we take proactive actions,” Sandeep Batra, executive director at ICICI Bank, had said during the lender’s post Q1 earnings media call.
ICICI Bank had seen negative growth of over 31,000 credit cards in May as well. RBL Bank also has seen a consistent drop in its new card addition since it stopped sourcing from Bajaj Finance in November last year.
“We have been consciously growing this (credit card) portfolio slower,” said Jaideep Iyer, head of strategy at RBL Bank. “It’s important that we continue to put a high threshold for new origination of cards both from asset quality as well as cross-sell standpoint to ensure that this becomes a meaningful customer acquisition tool for the bank rather than only a credit card acquisition tool.” Analysts say banks are scouting for top quality customers to arrest future delinquency issues which is limiting growth.
“Banks are cautiously growing their book and targeting only high quality customers, hence we are seeing a slowdown,” said said Ashutosh Mishra, head, institutional equities research at Ashika Stock Brokin. “There is a RBI rule which directs banks to deactivate cards that have remained unused for 365 days or more, the period of declassify such cards has started again.”
In terms of banks that reported an increase in card base, HDFC Bank added 212,000 cards and SBI Cards 83,000 cards. The pace of additions slowed compared to previous months. They had added 274,000 cards and 126,000 cards, respectively, in May. Federal Bank and IDFC First Bank have been consistently adding new cards. In June, Federal Bank added more than 92,000 cards while IDFC First Bank added more than 70,000 cards.
Total net new card issuance fell by 235 last month as total credit card base remained flat at 111.1 million. Lenders had added over 76,000 net new credit cards in May 2025 and 51,000 net new cards in June 2024.
