Credit card spending fell 5.9 per cent year-on-year (y-o-y) to Rs 2.04 lakh crore in September 2026, the first decline since February 2021. The main reason is last year’s high base, CareEdge Ratings said.
In September 2025, spending jumped 13.3 per cent over August after the GST rate cuts took effect and festive online sales began in the last week of the month. This year, the festive sales start in October, it said.
Online spending fell 12.5 per cent from a year ago, while point-of-sale spending grew 7.2 per cent. As a result, online’s share of total spending fell  469 basis points to 61.70 per cent, as per the report.
Private banks’ share rose 44 basis points month on month( m-o-m) to 73.78 per cent, led by the largest private bank, whose spending grew 7.7 per cent y-o-y while the other large issuers saw declines.
Public sector banks’  (PSBs) share fell 34 bps m-o-m to 20.41 per cent. Spending at PSBs other than SBI grew 26.3 per cent  y-o-y.
The card base grew 10.5 per cent year-on-year, but spending per card fell 14.8 per cent.
Transactions rose 23.2 per cent, while the average transaction size fell 23.6 per cent to Rs 3,343. This is partly because more card payments are now made through UPI. The other reason is that the large festive purchases seen last September did not repeat, the report said.
CareEdge expects spending to rise to Rs 2.28–2.38 lakh crore in October as festive sales begin.
Taken together, spending in August and September was broadly flat y-o-y (down 0.4 per cent), suggesting most of the September decline came from the shift in festive sales.
Growth had, however, slowed before September, to 6.7 per cent y-o-y in July–August from 7.9 per cent in Q1FY27. In their Q2FY27 results, large issuers linked the weaker y-o-y spending to the festive season shifting from September to October, CareEdge noted.
In H1FY27, spending rose 4.9 per cent y-o-y to Rs 12.18 lakh crore. Growth slowed to 2.1 per cent in Q2FY27 from 7.9 per cent in Q1FY27, mainly because of the September decline.
Spending is likely to rise in October and November due to festive sales.
