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Knowledge Byte Blog on Credit Cards

Knowledge Byte Blog

Credit Card

Introduction

In India, there are 74 issuers of credit cards, including the top three Indian private banks (HDFC Bank, Axis Bank and ICICI Bank). The credit card markets of India continue to be significantly underpenetrated, though. 

HDFC Bank is the market leader with the greatest share in the credit card sector, while the share of City Union Bank is the lowest. Despite the Reserve Bank of India’s prohibition on issuing new credit cards in the previous eight months, HDFC Bank has been able to preserve its leading status with a 23.06% market share. Let us consider India’s Credit Card market share:

Commercial Banks

Although commercial banks are certain kinds that serve customers on a daily basis, commercial banks tend to focus on supporting enterprises. Big and small enterprises can utilize commercial banks when a checking or a savings account has to be opened, borrow money, get credit or transfer cash to foreign market companies.

Private banks 

Private banks are banks where private shareholders and not the government own a majority of their holdings. Private sector banks have private promoters, they are managed and controlled and they are allowed to function according to market forces. There are typically regulated hence guaranteeing the security of public deposits entrusted to such entities and is also governed by directives issued periodically by central banks.

Private Sector Banks    
AXIS BANK LTD 7311922 11.44%
DCB BANK LTD 4690 0.01%
DHANALAKSHMI BANK LTD 6021 0.01%
FEDERAL BANK LTD 20687 0.03%
HDFC BANK LTD 14742862 23.06%
ICICI BANK LTD 11458682 17.92%
IDBI LTD 37739 0.06%
IDFC Bank Limited 457015 0.71%
INDUSIND BANK LTD 1618262 2.53%
JAMMU AND KASHMIR BANK 85245 0.13%
KOTAK MAHINDRA BANK LTD 2419203 3.78%
RATNAKAR BANK LIMITED 3007187 4.70%
TAMILNAD MERCANTILE BANK LTD 31150 0.05%
YES BANK LTD 997181 1.56%

Public sector banks

Public sector banks are the largest kind of government-controlled banks in India, with a majority share (i.e. above 50%) held by the Government of India’s finance ministry or Indian state finance ministry. Gazette officers are those employed by officers and their subsidiaries. The workers that work for these particular organizations and their subsidiaries are likewise fully qualified officials. These banks’ shares are listed on the stock exchanges.

Public Sector Banks    
BANK OF BARODA 679271 1.06%
BANK OF INDIA 166124 0.26%
BANK OF MAHARASHTRA 63302 0.10%
CANARA BANK 882577 1.38%
INDIAN BANK 135271 0.21%
INDIAN OVERSEAS BANK 66016 0.10%
PUNJAB NATIONAL BANK 311612 0.49%
STATE BANK OF INDIA 12405068 19.40%
UNION BANK OF INDIA 513108 0.80%

Foreign Banks

 The majority of foreign banks in India are foreign bank subsidiaries. They come from overseas promoters and are managed. In India, some international banks are Citibank, Bank of America, Standard Chartered Bank and Hong Kong Bank.

Foreign Banks    
AMERICAN EXPRESS 1457544 2.28%
BANK OF AMERICA 23928 0.04%
CITI BANK 2593999 4.06%
HONGKONG AND SHANGHAI BKG CORPN 810571 1.27%
SBM Bank India 182167 0.28%
STANDARD CHARTERED BANK LTD 1403863 2.20%
AU SMALL FINANCE BANK LIMITED 35208 0.06%

Conclusion

The expenditure on credit cards grew strongly, from 2015 to 2019, with the CAGR rising by 32 percent. In all, the increase in credit card expenditures should still reach Rs. 15 trillion by 2024. The Government has fostered its goal of a cashless society, digitization, e-commerce and the growth of its POS infrastructure.

 

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