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SBI Card Sees Retail Spends Drop 60 Per Cent

 
SBI Cards and Payment Services Ltd, India’s second-largest credit card company, has seen retail spends slump nearly 60 per cent during the period of extended lockdown when compared with the first half of March. In a stock exchange filing last week, SBI Card said the daily average run rate of retail spends for the last 15 days of March was lower by 31 per cent when compared with the first 16 days of March. With the extension of the lockdown, average daily retail spends are lower by 60 per cent when compared to the first half of March, the credit card company added. Corporate card spends have also declined at similar rates, it added.
According to a 21 April report by Bank of America, SBI Card customers had an average monthly spend of Rs 10,815 per card for the first 10 months of FY20, slightly lower than the industry monthly average of Rs 11,031 per card. In the same period, SBI Card had a 18 per cent share of overall credit card spends, second to market leader HDFC Bank’s 29 per cent share. SBI Card had approximately 10 million outstanding credit cards at the end of this 10-month period.
‘The company is keeping a close watch on portfolio and is drawing up plans to mitigate the impacts post lifting of lockdown with special focus on online spends. Repayments from retail customers are higher than retail spends leading to decrease in transactor receivables,’ SBI Card said.
Read EquityPandit’s Nifty Outlook for the Week
The covid-19 pandemic is expected to hit the growth of credit card industry as well as asset quality in the near term, analysts believe.

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