New Delhi, July 8 (IANS) India’s credit‑card market has expanded more than three-fold over the past decade and first‑time cardholders are younger and more widely distributed geographically than other countries, but overall penetration remains low at 25 per cent of credit‑active consumers indicating huge room for growth, a report said on Wednesday.

The report from TransUnion CIBIL said half of new‑to‑credit‑card consumers were aged 30 years or below as of March 2026, up from 43 per cent in March 2022.

Around 46 per cent of them lived in semi‑urban and rural markets in March 2026, up from 42 per cent in March 2022.

NTCC consumers are entering the card market with a more active credit profile. The report found that 25 per cent of NTCC consumers already had three or more open credit products, suggesting that for many consumers, the first credit card is being added to an existing credit wallet, and not necessarily an entry product.

Compared to the United Kingdom at 70 per cent, Colombia at 62 per cent and Hong Kong at 98 per cent, India’s credit card penetration at 25 per cent of credit-active consumers, as of March 2026, is lower than several mature and emerging credit markets.

The current low penetration rate along with the promising demographic participation clearly indicates an opportunity to grow the card portfolios responsibly, the report noted.

India’s credit card market has expanded significantly over the last decade, across the number of cards, consumers and balances. Between March 2016 and March 2026, the number of cardholders grew 3.6-fold from 1.4 crore to 5.2 crore.

Outstanding card balances rose at a faster pace, growing 8.3-fold from Rs 0.4 lakh crore to Rs 3.1 lakh crore, with active credit cards growing 5-fold from 2.1 crore to 10.7 crore.

Active credit cards accounted for 56 per cent of consumption-led credit accounts in March 2016 and rose to 38 per cent by March 2026. Card balances as a share of consumption-led credit balances in the industry also moved from 36 per cent to 26 per cent over the same period.

“Many consumers use cards alongside small-ticket personal loans, consumer durable loans and other short-tenure credit products. This reflects a consumer credit wallet that is becoming deeper, more formal and more responsive to everyday consumption needs,” said Bhavesh Jain, MD & CEO, TransUnion CIBIL.

The share of consumers with no prior credit experience was lower at 30 per cent for Gen Z in 2024, compared with 56 per cent for millennials in 2018, the report noted.

Gen Z consumers were also more likely to already have consumption-led credit products in their wallet, with 18 per cent holding an open consumer durable loan and 23 per cent holding an open small-ticket personal loan at first card opening.

—IANS

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