Correct Answer : Option (D) - 2.3 million
The outstanding credit card base dropped to 77.99 million in August 2022 from over 80 million in July 2022, mainly on account of the new norms of the Reserve Bank of India (RBI) that warrant the deactivation of cards that are inactive for a year.
While there was a 2.8 per cent decline in net card additions on a month-on-month (MoM) basis in August, a first in many months, credit card spends slipped 3 per cent on a high base. Still, spends topped the Rs 1-trillion mark for the sixth consecutive month.
The banking system had been adding about 1-1.5 million cards a month for some time now. But in August, “credit cards outstanding for the industry declined by 2.3 million, largely as a result of sharp declines seen for HDFC Bank and Axis Bank.
This is largely on account of the implementation of the new RBI norms requiring credit card companies to deactivate cards that are inactive for 365 days. This should impact other players, as well with a lag”, stated Suresh Ganapathy and Param Subramanian in a report for Macquarie Research.
Major issuers, such as HDFC Bank and Axis Bank
, have seen a significant drop in their net credit card additions in August 2022.
The number of HDFC Bank’s
outstanding credit cards dropped by 8.47 per cent
in a month to 16.42 million
, from 17.94 million in July
. Axis Bank witnessed a 10.6 per cent drop
in its outstanding credit card base to 8.87 million
, from 9.93 million in July 2022
. HDFC Bank is the largest credit card issuer in the country and Axis Bank is the fourth-biggest..Source : Business Standard