India's credit card market achieved a significant milestone with total credit card spends crossing ₹23.62 trillion in FY26, according to SBI Card's latest report. Retail spends reached the highest-ever level of over ₹3.54 trillion, marking a 15% year-on-year growth, with online transactions now accounting for nearly 62.5% of retail credit card spends. As per SBI Card's FY26 data, customers are increasingly using cards for both discretionary and non-discretionary purchases through digital platforms, reflecting a shift toward digital-first consumption behaviour. The second-largest credit card issuer and the largest pure-play credit card player in India noted that rising income and aspirations, progressive policies, digitisation, and growing payments infrastructure are reshaping credit card transactions. "Rising income and aspirations, progressive policies, digitisation, and growing payments infrastructure is reshaping credit card transactions," said Salila Pande, managing director and chief executive of SBI Card. "Customers are increasingly gravitating towards experiences, lifestyle-driven purchases, and seamless everyday transactions, reflecting a more confident and evolving mindset," Pande added.
Credit card adoption is gradually expanding beyond metropolitan markets in India amid rising incomes, improving digital awareness, and expanding payments infrastructure. Around 77 per cent of UPI-active credit card customers, and nearly 81 per cent of UPI-credit spends, originate from Tier 2 and Tier 3 cities, highlighting strong adoption of digital credit in emerging markets. The integration of RuPay credit cards with UPI is further accelerating this trend by enabling customers in smaller cities to use credit seamlessly even for their everyday spends, including small-ticket purchases. This deeper penetration of digital credit products beyond metropolitan areas indicates the growing acceptance of credit cards as a mainstream payment method across India's diverse geographical markets, with UPI-linked credit cards and category-specific rewards playing a crucial role in changing consumers' credit habits. The trend is also helping credit card penetration expand beyond major metropolitan areas, with customers increasingly using credit cards for small-ticket and daily purchases in these markets.
As per SBI Card's Q4 FY26 data, UPI-linked credit card spends grew by over 10% quarter-on-quarter, led by segments such as departmental stores, groceries, utilities, fuel, apparel, and restaurants. The company also saw healthy double-digit growth in EMI-related spends in FY26 compared to last year, with customers opting for EMI-based transactions as they make purchases of gadgets, consumer durables, and other items affordable and convenient. SBI Card noted that the trend of spreading payments in instalments for high-value purchases is extending beyond metros into Tier 2+ cities, with EMI-based spending recording double-digit year-on-year growth in FY26, driven by purchases of consumer electronics, gadgets, and durable goods. The popularity of EMI-based transactions can be attributed to the fact that it allows customers to make payments towards gadgets, electronics, etc., in an affordable and convenient manner. Growth was led by categories such as groceries, departmental stores, utilities, fuel, apparel and restaurants, indicating that consumers are becoming more comfortable using credit cards for everyday transactions.
Customers are showing a preference for using multiple credit cards to cater to various spending requirements, with examples including SBI Card MILES for travel, SBI Card PULSE for wellness, BPCL SBI Card for fuel, Flipkart SBI Card for lifestyle spends, and PhonePe SBI Card for digital transactions. The rising adoption of such credit cards among digitally savvy customers reflects a growing inclination towards category-specific benefits, personalised rewards, and ecosystem-led value propositions. This trend highlights the evolution of customer behaviour towards more experience-driven card usage across shopping, travel, lifestyle, and everyday spending categories. According to SBI Card's FY'26 data, India had around 118.6 million credit cards in circulation, while the numbers reflect how the market is now moving beyond just issuing more cards to encouraging more frequent and wider usage in everyday spending. Consumers today often use different cards for different needs - from travel and shopping to fuel and dining - depending on the rewards and offers available, with hyper-personalised, seamless and convenient experiences powered by self-service-led digital platforms increasingly shaping customer engagement with brands.
India's credit card users increasingly embrace digital, lifestyle and EMI-led spending as the market witnesses a shift from simple card issuance growth towards deeper consumer usage. The country had around 118.6 million credit cards in circulation during FY'26, while total credit card spending crossed ₹23.62 trillion, reflecting growing consumer confidence and wider adoption of digital payments. The evolving consumption landscape is being driven by rising incomes, expanding urbanisation and an aspirational middle class, with spending patterns increasingly shifting towards experiences and discretionary purchases alongside essentials. The report highlighted the growing role of digital customer engagement tools, with users increasingly accessing SBI Card's mobile application, live chat services, chatbot support and WhatsApp-based services for activities ranging from card applications to customer support. India's Unified Payments Interface, or UPI, has also emerged as a major growth driver for credit card usage, particularly after the integration of RuPay credit cards with the payments system, with spending through UPI-linked credit cards rising more than 10% quarter-on-quarter.
