Credit Card NPAs surge 28% in 2024 amid soaring usage, rising consumer debt: RBI
The Reserve Bank of India (RBI) has reported a sharp rise in non-performing assets (NPAs) in the credit card segment, reflecting growing stress in unsecured consumer lending. According to the latest data, credit card NPAs jumped by 28.42 per cent to ₹6,742 crore during the 12-month period ending December 2024, compared to ₹5,250 crore in December 2023.
This increase comes despite the overall decline in gross NPAs of the banking sector, which fell from ₹5 lakh crore (2.5 per cent of advances) in December 2023 to ₹4.55 lakh crore (2.41 per cent) by December 2024. The credit card segment, however, showed a contrasting trend, with gross NPAs rising amid continued economic headwinds and rising consumer indebtedness.
Credit card outstandings grew to ₹2.92 lakh crore in December 2024, up from ₹2.53 lakh crore a year ago. The NPA ratio in this segment rose to 2.3 per cent, up from 2.06 per cent in the previous year. Notably, credit card NPAs have increased more than fivefold since December 2020, when they stood at ₹1,108 crore.
Despite banks tightening their overall lending norms, personal loans and credit cards have emerged as stress points. Credit card dues, being unsecured and carrying high interest rates—ranging from 42 to 46 per cent per annum on overdue balances—pose a significant risk for both banks and borrowers. A credit card account is classified as an NPA if dues remain unpaid for over 90 days.
The surge in credit card usage is evident in transaction data. The value of credit card transactions tripled over the past three years, reaching ₹18.31 lakh crore in the year ended March 2024, compared to ₹6.30 lakh crore in March 2021. Monthly credit card spends touched ₹1.84 lakh crore in January 2025, up from ₹64,737 crore in January 2021. Meanwhile, the number of credit cards issued rose to 10.88 crore in January 2025 from 6.10 crore in January 2021.
Bank officials attribute the rise in card adoption to attractive offers such as reward points, lounge access, and short-term credit facilities. However, they caution that failure to repay dues beyond the interest-free period leads to extremely high interest charges and credit score deterioration, increasing the risk of borrowers falling into a debt trap.
In response to rising exposure in unsecured lending, the RBI in November 2023 raised the risk weight on bank exposures to consumer credit, credit card receivables, and non-banking financial companies (NBFCs) by 25 per cent to 150 per cent. The central bank’s Financial Stability Report noted that while demand for credit remains strong, the move has moderated growth in personal loans and credit card receivables.
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'Scams, kickbacks and favoritism have become order of the day' in Karnataka: BJP
New Delhi(PTI): The BJP on Friday said the Congress government in Karnataka may not last long with corruption and appeasement politics becoming the “order of the day” in the state.
This came after the Karnataka State Contractors Association (KSCA) on Thursday claimed that "unseen hands and brokers" were active in the offices of Deputy Chief Minister D K Shivakumar and two other senior Cabinet Ministers, alleging that the menace of commission in the state was now more than the previous BJP government.
Responding to the allegations, the deputy chief minister on Friday suggested that if anyone has demanded commission from the contractors to pay their bills, then they should file a complaint with the Lokayukta.
“In Karnataka, corruption is at its peak in an organised manner,” BJP national spokesperson Pratyush Kanth told a press conference at party headquarters here, reacting to the development.
“You have institutionalised corruption. Only big contracts are getting their bills cleared. The medium and the small ones are struggling,” he said.
Kanth said the Congress had promised “so many things” during the state assembly polls but “scams, kickbacks and favoritism have become order of the day” under the party’s rule in the state.
While the crisis of “water and electricity bills” continues in Karnataka, the road taxes on new vehicles and bus fares have gone up, he said.
“The common people are bleeding there…This corrupt government is not going to last long. This project of Rahul Gandhi to ensure corruption all over KA is not going to have the light of the day,” he added.
Citing recent remarks reportedly made by Karnataka Chief Minister Siddaramaiah’s Economic Advisor Basavaraj Rayareddy, the BJP spokesperson said people in power, who run the state, are now saying that the state has become number one in corruption.
“Even the revenue minister of Karnataka had (earlier) gone on record to say that there is a lot of corruption in his department…This is very disturbing because Karnataka has to be the ‘khata khat model’ of Rahul Gandhi,” he said, taking a swipe at the Congress leader.
Rayareddy, who was reported to have recently said at an event that Karnataka is number one in corruption, later clarified that his remarks were misquoted and taken out of context.
