The Indian credit card market is gaining momentum

Written by Kapronasia || November 15 2023

We have been writing for a while now about the potential for credit cards to capture market share in India, irrespective of the trajectory of buy, now pay later (BNPL) and e-wallets. In a nutshell, there is nothing quite like a credit card when it comes to cashless payments: the potential for rewards, the potentially significant credit limit, and in some cases, the prestige of holding a specific card. And then there is the bonus that paying off the balance promptly helps one build a solid credit profile over time. Even though India’s credit card penetration is estimated at just 5.5%, in absolute terms, that’s still about 77 million people because the subcontinent’s population is 1.4 billion. So even at that low level of penetration, India has a larger credit card market than all of France or the UK.

A trend to keep an eye on in India’s credit market is co-branding, and a key player may soon enter the market: the most valuable Indian company. That’s right, according to TechCrunch, Reliance is teaming up with the state bank SBI to launch two co-branded credit cards on the homegrown RuPay network. If the documents reviewed by TechCrunch are accurate, the Reliance SBI Card will offer perks like vouchers for Reliance Retail and discounts for consumption in other parts of the company’s ecosystem, among them Trends, Ajio, JioMart, and Urban Ladder.

Adding a credit card would make sense for Reliance as it beefs up broader financial services. Its finance unit has launched lending and insurance businesses and debit cards will likely be next.  

Another interesting new arrival to India’s credit card market is the co-branded Marriott-HDFC Bank card, the first card of its kind in the subcontinent – which was launched in August. This one has the potential to differentiate itself in terms of rewards, especially as Marriott is the largest hospitality company in India with 145 hotels in 41 cities across 16 brands, and there are about 4.5 million members of its Bonvoy Loyalty program in India. The Marriott-HDFC credit card will run on Diners Club, part of the Discover Global Network.

Meanwhile, HSBC India CEO Hitendra Dave told Reuters earlier this month that the UK-based bank plans to launch digital credit cards in the country alongside personal loans to affluent customers as part of a strategy to serve the subcontinent’s fast-growing premium personal banking market. HSBC's new private banking business in India, part of a wider focus on Asian wealth management, targets ultra-high net worth customers, typically defined as those a net worth of over $30 million.