Credit cards remain a major source of income for banks. They accrue heavy interest from the consumers, and hence a major asset for lenders. In India, HDFC bank leads the credit card market, having around a quarter of the market share (23.6% to be precise).
In December 2020, the Reserve Bank of India banned HDFC from acquiring any new credit card customers after a few outages in the bank’s internet banking and online payment systems. They were asked to increase accountability by examining the lapses in the system and fixing them.
However, even this ban didn’t deter the bank from its Number 1 position. Now, this curb has finally been lifted and the bank has big plans for the future. It aims to add 5 lac new credit cards every month beginning from February 2021, a move aimed to further cement its position as the market leader.
But while talking about credit cards, there is one very important indicator that people miss talking about – per credit card spend. And HDFC, even being the market leader, does not lead this particular criterion.
Who Leads In Per Credit Card Spend?
Karur Vysya Bank, set up in 1916, and now having its operations all over India leads when it comes to per credit card spend. Its credit card market share, however, remains insignificant (a little higher than 0%) when compared to the big leagues.
The bank’s per card spend is 1.17 times higher than the market’s average and 1.83 times of the HDFC bank’s per card spend. It remains the most profitable business for the bank, as claimed by the bank.
The per card spends for the Karur Vysya Bank is a little over Rs. 21,712. The next in line is the Indusind Bank with Rs. 16,421. HDFC Bank comes 6th in position with Rs. 11,875. So, Karur Vysya Bank beats HDFC by a significant lot.
The bank’s share, as per experts, may increase by 43% over the span of 12 months. The stock is also a part of Rakesh Jhunjhunwala’s portfolio. So, it holds good for investment purposes too.
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