Credit Card Market Consolidates: HDFC Bank and SBI Approach 50% Spending Control
The landscape of credit card spending in India is undergoing significant consolidation, with HDFC Bank and State Bank of India (SBI) moving remarkably close to controlling half of the total transaction value. By January 2026, these two banking giants, along with the top five issuers, have dramatically expanded their dominance, now accounting for a commanding 85.6% of all credit card spending by value.
Rapid Market Share Gains by Top Players
This notable shift represents a clear migration of high-value spending toward established legacy lenders. At the beginning of Fiscal Year 2026 in April 2025, the top five banks collectively held 81.2% of total credit card transaction value. Within just ten months, their share surged by 4.4 percentage points, leaving smaller banks and fintech issuers to compete for less than 15% of industry spending, despite ongoing expansion in card issuance.
The consolidation is overwhelmingly driven by the top two issuers. HDFC Bank, already the undisputed market leader, increased its share of transaction value from 28% in April to 28.4% in January. SBI emerged as the biggest gainer of the fiscal year, expanding its share sharply from 19.3% to an impressive 24.7%. Together, these two banking powerhouses absorbed more than five percentage points of market share from competitors, effectively offsetting declines recorded by ICICI Bank and Axis Bank.
Kotak Mahindra Bank retained its fifth position with a modest increase in share from 3.3% to 3.5%. The dominance of these top banks has been further reinforced by the drop in foreign banks' share from 5% to 4.5%, with Citi being the most recent foreign bank to exit the credit card business entirely.
Divergence Between Card Issuance and Spending Patterns
Despite this pronounced concentration in spending value, the distribution of credit cards across issuers remains comparatively stable. The top five banks accounted for 75.2% of active cards in April 2025, slipping only marginally to 74.7% by January 2026. This divergence between card share and spending share suggests a crucial market dynamic: while smaller lenders continue to expand card issuance, consumers rely disproportionately on cards from the largest banks for high-value purchases.
This pattern indicates that major expenses such as travel bookings, lifestyle consumption, and significant e-commerce transactions are increasingly channeled through cards issued by HDFC Bank and SBI. Some smaller banks that issued credit cards in partnership with fintechs and non-banking financial companies (NBFCs) have also faced regulatory restrictions, further contributing to this consolidation trend.
January 2026 Data Reinforces Concentration Trend
Data from January 2026 further reinforced this concentration, even as overall spending cooled following the year-end festive surge. Total industry credit card spending declined 2.7% month-on-month to nearly Rs 2 lakh crore, down from close to Rs 2.5 lakh crore in December. Online spending fell 2.5% to Rs 1.23 lakh crore but retained its dominance with a 61.8% share of transaction value.
Point-of-sale spending declined more sharply by 3.2% to Rs 76,000 crore, reflecting a notable drop in offline discretionary consumption. Remarkably, even as the total spending pie shrank in January, HDFC Bank and SBI increased their combined share. Their joint transaction value fell from Rs 97,127 crore in December to Rs 94,544 crore in January, a smaller contraction than the industry-wide decline, lifting their combined market share marginally from 47.4% to 47.5%.
In January alone, HDFC Bank recorded Rs 56,518 crore in credit card payments, while SBI recorded Rs 38,026 crore, indicating their near-majority control of industry spending. The consolidation trend was also visible in transaction volumes, with the two banks accounting for 43.9% of total credit card transactions in January, underscoring their expanding influence across both value and volume metrics.
