HDFC Bank's share in the number of outstanding credit cards dropped to 25% at the end of September 2019 from 30% in March 2016, as rivals SBI Card and ICICI Bank increased their share over the same period. A report compiled by Citi Research from Reserve Bank of India (RBI) data shows that the share of the SBI group in the number of credit cards stood at 18% at the end of Q2FY20, up from 15% in March 2016, while that of ICICI Bank was steady at 15%.
ICICI Bank's share had dipped to 13% in March 2018 from 15% in March 2016. It recouped share in the next two years.
In terms of volume and value of transactions made using credit cards at point of sale (PoS) terminals, HDFC Bank continued to lead the market, with shares of 26.4% and 28.1%, respectively.
SBI gained market share in outstanding debit cards as well between March 2016 and September 2019, increasing its share to 36% from 29%. Bank of Baroda (BoB) held on to the second spot with a 6% share.
Interestingly, Paytm Payments Bank broke into the top three among debit card issuers within 16 months of its launch, gaining a 5% share by the end of March 2019 and expanding it to 6% over the next six months.
Despite constituting the larger share of the debit-card base in the country, customers of the smaller public-sector banks (PSBs) clearly lag behind those of private banks in terms of actually using the cards. While the share of BoB in cards outstanding was 6% in September 2019, its share in the usage pie was lower at 4.6%. HDFC Bank, ICICI Bank and Axis Bank-all of whom lag BoB in the number of debit cards outstanding-held second, third and fourth positions, respectively, in terms of both volume and value of debit card-based PoS transactions.
A large number of new bank accounts opened under the Pradhan Mantri Jan Dhan Yojana (PMJDY) resulted in PSBs becoming the largest issuers in the debit card space. In the last one year, the number of debit cards in circulation has actually fallen, particularly in the PMJDY segment.
Between September 2018 and September 2019, there was an addition of about 11 million credit cards and reduction of about 154 million debit cards. A recent report by payments service provider Worldline said, "While the rise in credit cards may be attributed to the growing digital payments and the expansion of retail borrowers in the market, the fall in debit cards is likely due to the discontinuation of magnetic stripe and the mass closure of accounts with zero balances."