SBI CARDS – Ultra News

ICICI Bank is emerging as a strong challenger for long-time leader HDFC Bank in India's credit card market, thanks to strong take-up for its co-branded card with Amazon, according to an analysis of RBI's January numbers. ICICI Bank accounted for 2.41 lakh of the 13 lakh new credit cards added in January 2022. With this, its total credit cards has risen to 1.26 cr out of a total of around 7 cr credit cards in use in India. In comparison, market leader HDFC Bank was able to add only 2.1 lakh new credit card users during January, taking its total to 1.60 cr. HDFC Bank, however, continues to remain the No.1 player in the credit card market in India with a share of 22.8% in terms of number of customers. Its market share is even more impressive in terms of money spent, with the bank's credit cards accounting for 24.8% of all credit card expenditure during January. However, due to the aggressive expansion by ICICI Bank in recent months, HDFC Bank has been seeing a slippage in both metrics. Take the case of spends. Here, HDFC Bank used to have have nearly double the market share of ICICI Bank a year ago. In other words, the bank accounted for 31% of all credit card spends in India in January 2021, while ICICI Bank had a share of just 15.8%. Fast forward to January 2022, the difference has narrowed to just 3.3 percentage points with HDFC Bank's share falling from 31% a year ago to 24.8% this year and ICICI Bank seeing an increase in its share from 15.8% to 21.5%. In terms of number of customers too, the market share gap has narrowed from around 8.3 percentage points a year ago to just 4.3 percentage points. The the first half of 2021 has seen a steady erosion in HDFC Bank's credit card market share, even though the bank has tried to fight back starting in September 2021. For example, HDFC Bank had seen its total credit card customers in India decline steadily from a peak of around 1.56 cr in November 2020 to less than 1.50 cr by July 2021. However, since then, HDFC Bank has put up a strong performance, and added nearly 13 lakh customers in the five months from September to January. During the same five months, ICICI Bank was able to add only a little more than 11 lakh new credit card customers. However, ICICI Bank has emerged as a winner over the full year because its performance has been steadier than that of HDFC Bank. During the whole of 2021, ICICI Bank has never added less than 1.4 lakh new users per month. Compared to this, HDFC Bank's performance has been extremely volatile until July, and the bank has reported net decreases in its credit cards in each of the eight months of 2021. In March 2021, for example, the bank lost nearly 2.12 lakh credit cards. Even though not as impressive as ICICI Bank, other banks such as SBI and Axis Bank have also been witnessing strong growth. SBI Cards, for example, has seen its market share improve from 18.7% of all credit card spends in India in January 2021 to 20% in January 2022 -- becoming the first public sector bank to command a market share of 20% or more. It has managed to do this even as its share of total number of cards has remained static -- marginally declining from 19.1% in Jan 2021 to 18.9% in Jan 2022. SBI Card too has been adding new credit card customers at a feverish pace in the last seven months. It has added over 12.5 lakh new cards. Another player that has got its act together in the last five months is Axis Bank. The company has added almost 10.5 lakh cards during the last five months, giving it a better run rate than SBI during this period and almost catching up with ICICI Bank's 11 lakh tally. This is despite the fact that Axis Bank's credit card business is less than half the size of SBI's credit card business, with a spend share of 8.7% vs SBI's 20%. Part of the reason for the poor spend-market-share of Axis Bank has been that it has been less aggressive compared to ICICI Bank, SBI and even HDFC Bank in offering instant discounts, cash back and other incentives to customers. Because of this, the average spend per card for Axis Bank was around 9,179 rupees in January 2022, compared to 13,191 for SBI Cards, 13,548 for HDFC Bank and 14,964 for ICICI Bank. Interestingly, growth in spend per card was the strongest for ICICI Bank and the bank saw a 49% jump in the average bill generated by its credit card users during January vs the previous year. HDFC Bank, on the other hand, saw only a 2.9% growth during the month compared to Jan 2021. Both SBI and Axis Bank saw 25-26% increases in average monthly spend/card compared to Jan 2021. Interestingly, at No.5 in terms of total spend market share in India is the Mumbai-based RBL Bank, formerly known as Ratnakar Bank. It has a market share of 4.6% in terms of total credit card spends in India. Citibank, at No.6, has a share of 4.1%, followed by Kotak Mahindra Bank at 2.7%, American Express at 2.5% and Standard Chartered at 1.2%. In all, India had 7 cr (70 mn) credit cards as of January 2022, generating total spends of 87,768 cr or about $11.7 bln during the month. In comparison, the country is estimated to have around 100 cr (1 bln) debit cards in circulation. The total addition of credit cards during January was around 13 lakhs.

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