Indian Credit Card Spending Habits Evolve Amid Changing Consumer Preferences, SBI Card Finds

Credit Cards in India: From Occasional Usage to Everyday Habit

Credit cards in India are undergoing a significant transformation, shifting from occasional usage for big-ticket purchases or emergency expenses to becoming an integral part of everyday financial behavior. According to SBI Card's latest data, India had nearly 118.6 million credit cards in circulation in FY26, with spends crossing Rs 23.62 trillion.

The report highlights a significant shift in consumer behavior, with credit cards being used for routine daily expenses such as groceries, fuel, utility bills, and even small UPI payments. This trend is driven by the increasing adoption of UPI-linked credit cards, which saw spends grow over 10 percent quarter-on-quarter in Q4 FY26.

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The growth of UPI-linked credit cards is a significant indicator of changing consumer behavior, with people increasingly using credit cards for routine expenses due to the seamless experience it provides within existing UPI habits. Retail spending through SBI Card crossed Rs 3.54 trillion in FY26, growing 15 percent year-on-year, while online transactions made up nearly 62.5 percent of spends.

The shift from traditional credit card usage to UPI-linked payments is also changing the psychology of credit. Consumers no longer need to consciously "use a credit card" in the traditional sense of swiping for a large purchase. Credit is now getting woven into everyday payments in a way that feels frictionless and familiar.

Tier-2 and Tier-3 cities are driving the next phase of credit card growth, with around 77 percent of UPI-active credit card users and nearly 81 percent of UPI-credit spends originating from these regions. The integration of RuPay credit cards with UPI is accelerating this shift by making even low-value transactions possible through credit.

Another trend emerging from the report is the rise of multi-card usage, with consumers increasingly picking cards based on spending habits. This trend reflects how credit cards are evolving into lifestyle and rewards products rather than just borrowing tools. EMI-led spending is also continuing to grow, especially for gadgets, consumer durables, and other high-value purchases.

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Taken together, the trends point to a broader shift in how Indians are spending and borrowing. Credit cards are increasingly moving beyond occasional usage and becoming embedded into everyday financial behavior. So, it's no longer just about how many Indians own credit cards, it is about how seamlessly credit itself is becoming part of daily life.